KUALA LUMPUR:
BANK Negara Malaysia has projected the economy to grow by between 4.3 and 4.8 per cent this year.
Governor Datuk Muhammad Ibrahim said the gradual improvements in global growth, commodity prices and domestic demand would lend support to economic activities.
The new growth projection comes within the earlier projection by the Treasury when the fiscal budget was announced in October last year.
Inflationary pressures will likely to rise to three to four per cent due to higher global commodity and energy prices and weaker ringgit.
“They are cost-driven factors. There will be months when the rate rises even above four per cent.
“But we expect the rate to be lower in the second half,” he said at a media briefing to launch the central bank’s annual report, here, yesterday.
Overall, the current account is expected to register a surplus of one to two per cent of gross national income this year.
On the supply side, all economic sectors are projected to register positive growth this year, with the services and manufacturing sectors as the key contributors to overall growth.
The agriculture sector is also expected to rebound as yields recover after the El Niño weather phenomenon while growth in the mining sector is expected to remain steady, as a stronger expansion in natural gas output offsets a moderation in the crude oil sub-sector.
Alliance Bank described the central bank’s projections as reasonable, given the current economic challenges.
The research house expects the economy to grow by 4.4 per cent with the resilience in private consumption amid manageable headwinds like soft labour market and weak consumer sentiments.