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Malaysia Q4 GDP grows 5.9% y-o-y, 2017's pace hit three-year high
[KUALA LUMPUR] Malaysia's economy expanded 5.9 per cent in the fourth quarter from a year earlier, central bank data showed on Wednesday, growing more strongly than expected and capping a year of robust growth.
The pace for October-December pushed 2017 full-year growth to 5.9 per cent, its best result in three years and a marked recovery from 2016 when growth slumped to its slowest pace since the global financial crisis in 2009.
Bank Negara Malaysia (BNM) said domestic demand continued to drive growth in the fourth quarter, with healthy expansion in private consumption supported by wage and employment gains and private capital spending.
"On the supply side, most economic sectors recorded a moderate expansion, except for the agriculture sector, while growth in the mining sector declined," the central bank said.
The median forecast of a Reuters poll of 12 economists was for fourth-quarter growth to cool to 5.7 per cent, from the 6.2 per cent pace in July-September - the fastest in more than three years.
The government in October revised its 2017 full-year projection up to 5.2-5.7 per cent from 4.3-4.8 per cent.
"We think that growth will lose a little more steam over the course of this year," Alex Holmes, analyst at Capital Economics said after Wednesday's announcement on GDP.
"On the plus side, the economy should continue to benefit from rising investment, supported by large Chinese-backed infrastructure projects in the East Coast Rail Link and the ports of Melaka and Kuantan. But export growth, a key driver of the economy in 2017, is unlikely to be as strong this year," he added.
Malaysia's current account surplus widened to RM12.9 billion in the fourth quarter, from RM12.5 billion in July-September.
On Wednesday, the ringgit currency firmed by 0.4 per cent to 3.9220 to the dollar at midday. It has strengthened 12.8 per cent from Jan 4, 2017, when it hit a 19-year low of 4.9880.