KUALA LUMPUR: The Malaysian economy looks set to grow beyond the 4.5% initially projected by the Government, going by the strong third quarter gross domestic growth (GDP) of 5.1%.
The economy expanded by 4.5% in the first half of the year.
Bank Negara governor Tan Sri Dr Akhtar Aziz, in a press conference yesterday announcing the country’s economic performance for the third quarter, was confident that overall growth for the year would exceed 4.5% if momentum in the economy could be sustained.
The fourth quarter was traditionally a strong one, she said, and indications at the halfway point were good.
Growth was broad-based across all sectors. Manufacturing capacity utilisation rose to 86% and domestic demand had picked up.
Zeti said the banking system was robust, and interest rates would remain supportive of the current economic environment.
She reiterated that the currency peg, now going into its sixth year, would not be dismantled as it was still the most effective mechanism, apart from facilitating growth, to ensure stability and predictability.
Economic growth was expected to gather momentum, with growth prospects improved by the stronger domestic demand and the recovery in external demand.
Zeti said that risks exist mainly in the external environment, but better performing stock markets as well as the more robust performance of regional and global economies were encouraging signs of an improving global outlook.
She said the strong recovery in the manufacturing and services sector, and a more diversified structure, meant that the country was now less vulnerable economically.
Improving international reserves, which rose to almost RM166bil as at end-October, would also help cushion any unexpected shocks.
Related Stories:Third-quarter GDP growth of 5.1% stronger than expected
Did you find this article insightful?