KUALA LUMPUR: Malaysia’s economy expanded at a slower pace of 5.9% in the fourth quarter of 2017 but it was ahead of consensus and economists' forecast of 5.8%.
Ggrowth was slowed down from the 6.2% in the third quarter of 2017. However, on a year-on-year basis, the economy recorded firmer growth from the 4.5% in Q4 of 2016.
“On a quarter-on-quarter seasonally adjusted, GDP posted a growth of 0.9% (Q3 2017: 1.8%),” it said.
For 2017, Malaysia’s economy expanded at a faster pace of 5.9% compared with 4.2% in 2016 -- with a value of RM1.173 trillion at constant prices and RM1.352 trillion at current prices.
Nomura Global Markets Research said the slowedQ4 growth was due to a dip in domestic demand growth, though it contributed 5.7 percentage points to headline GDP growth, slightly less than Q3’s 6.0 percentage points.
“In particular, private consumption growth edged down to a still-robust 7.0% on-year in Q4 from 7.2% in Q3, while fixed investment growth moderated to 4.3% from 6.7%, offsetting a rise in government consumption growth to 6.9% from 3.9%,” it said.
Nomura Research said inventories also turned into a drag in Q4 (-0.2 percentage points from zero percentage points in Q3), offsetting net exports which contributed a larger 0.5 percentage points from 0.2 percentage points in Q3.
The research house said the main factor was that import growth moderated more sharply than exports to a still-solid 7.4% n-year and 7.1%, respectively.
By industry, manufacturing and mining output growth softened in Q4, but this was largely offset by a surge in agriculture output.
“For the Q4 of 2017, the services, manufacturing and agriculture sectors have been the anchor on the production side, with all sectors recorded positive growth except mining and quarrying.
“On the expenditure side, the performance was driven mainly by private final consumption expenditure,” said Nomura Research.
The Statistics Department, in its statement, pointed out the services sector recorded strong growth of 6.2% in Q4 2017, underpinned by wholesale & retail trade and information & communication sub-sectors.
Manufacturing sector grew at a slower pace of 5.4% (Q3 2017: 7.0%). Electrical, electronic & optical products continued to be the main impetus in manufacturing for this quarter, albeit at a moderate growth rate of 5.7%.
Agriculture sector recorded a strong 10.7% growth which was the highest growth since the third quarter of 2011. The expansion in this sector was mainly driven by the impressive performance of oil palm at 24.3% following a higher yield of fresh fruit bunches in this quarter.
GDP by expenditure approach
Private final consumption expenditure grew 7% in Q4 of 20017 (Q3 2017: 7.2%), while on a quarter-on-quarter seasonally adjusted increased to 1.8%.
The department said the momentum was contributed by the consumption on food & non-alcoholic beverages,communication, restaurants & hotels and housing & utilities.
Gross fixed capital formation (GFCF) recorded slower growth of 4.3% from 6.7% in Q3.
The slower performance of GFCF in Q4 was due to the moderation in machinery & equipment at 8.3% as compared to the 11.5% in Q3.
Meanwhile, exports recorded a growth of 7.1% due to moderation in external environment. Imports grew at 7.4%.
Click here for more:
Limited time offer:
Just RM5 per month.
