Malaysia’s Q3 Economic Growth Slows to 5.3%, Driven by Services Sector

Malaysia’s Q3 Economic Growth Slows to 5.3%

Malaysia's economy is projected to have grown by 5.3% in the third quarter of 2024 compared to the previous year, marking a slowdown from the 5.9% growth recorded in the second quarter. This decline, reported by the official advance estimates released on Monday, is attributed to various factors affecting economic momentum.

In Q2, the country experienced its fastest economic expansion in 18 months, fueled by increased household spending, robust exports, and higher investment levels. In response to these dynamics, the Malaysian government recently revised its economic growth forecast for 2024, now estimating growth between 4.8% and 5.3%, up from the previous range of 4% to 5%.

The growth in the third quarter was primarily driven by the services sector, which saw a 5.1% increase from the previous year. Additionally, expansions were observed in the manufacturing, construction, and agriculture sectors, according to data from the Statistics Department. However, the mining and quarrying sector faced challenges, contracting by 3.4% year-on-year due to declines in natural gas and crude oil production.

Trade dynamics also showed variation, with exports rising 7.8% year-on-year while imports surged by 20.8%. Chief Statistician Mohd Uzir Mahidin noted that a stable labor market, manageable inflation, supportive fiscal and monetary policies, and an ongoing recovery in tourism are expected to bolster economic performance.

Final GDP figures for the third quarter will be published on November 15.