PETALING JAYA: The Malaysian economy continued to strengthen, recording a 14.2% growth in the third quarter of this year (Q3 2022), up from 8.9% in the previous quarter, Bank Negara Malaysia (BNM) announced today.
On a quarter-on-quarter seasonally-adjusted basis, the economy grew by 1.9% compared with 3.5% in the previous quarter.
The growth was led by continued expansion in domestic demand, firm recovery in the labour market, robust electrical and electronics (E&E) and non-E&E exports as well as ongoing policy support.
The growth rate was partly lifted by base effect, due to the strict containment measures in Q3 last year.
However, gross domestic product (GDP) growth on an annualised basis has tapered off to 1.9% from 3.5% in the previous quarter.
The Q3 economic report, presented by BNM governor Nor Shamsiah Mohd Yunus to the media this morning, showed that expansion was recorded in economic activity across all sectors.
Leading the charge was the services sector, which saw a 16.7% expansion, up from 12% in the previous quarter. The growth was attributed to higher consumer-related activities amid a recovery in tourism, better labour market conditions and policy support.
The construction sector saw the most significant expansion, from 2.4% in Q2 to 15.3% in Q3 thanks to continued progress in commercial real estate, mixed development and small-scale projects.
Higher oil and gas output was the main driving force behind the substantial recovery in the mining sector, which saw a 9.2% growth in Q3 from a 0.5% contraction in the second quarter.
A strong demand for E&E products and a significant increase in production in the transport equipment sub-sector led to a 13.2% growth in the manufacturing sector in Q3, up from 9.2% in Q2.
Higher oil palm output led by receding labour shortages and improved yields saw to the recovery in the agriculture sector. It turned around a 2.4% contraction in Q2 to record a growth of 1.2% in Q3.
In the areas of domestic and external demand, BNM noted that private consumption growth eased to 15.1% in Q3 from 18.3% in Q2. The growth was led by continued household spending on necessities and discretionary items.
Public consumption rose 4.5% in Q3 compared with 2.6% in Q2 thanks to higher supplies and services spending.
Investments also recorded high growth. Private investment growth rose from 6.3% in Q2 to 13.2% in Q3. The improvement was in structures and M&E investments.
Public investment expanded 13.1% in Q3, compared with 3.2% in Q2 mostly because of higher capital spending by government and public corporations.
Malaysia also recorded a recovery in net exports in Q3. It grew 18.7% in the third quarter from a 28.7% contraction in the previous three months.
This was attributed to higher travel and transport receipts.
BNM said headline inflation is likely to have peaked for the year at 4.5% during the quarter, up from 2.8% in Q2, but core inflation rose to 3.7% from 2.5% in the previous quarter.
The central bank said the movement of the ringgit against the US dollar is also in line with major and regional currencies.
It said the depreciation is the result of the strong US dollar, and not because Malaysia is facing an economic crisis.
The ringgit opened at 4.6360/4.6405 against the US dollar today, up from yesterday’s close of 4.6950/4.6990.
BNM said the country’s economic outlook is still subject to risks related to weaker-than-expected global growth, heightened geopolitical tensions, escalation in supply chain disruptions and global financial market volatility.
