KUALA LUMPUR: Malaysia’s gross domestic product (GDP) grew 4.9 per cent in the second quarter (Q2) of 2019, despite ongoing global headwinds.
This is higher compared to the 4.5 per cent growth recorded in Q1 of 2019.
The country became the first in Southeast Asia to report an acceleration in growth in Q2.
Bank Negara Malaysia Governor Datuk Nor Shamsiah Mohd Yunus said the positive growth was driven by strong private sector expenditure, recovery in commodity output and higher net exports.
“Despite the challenging external environment, especially surrounding the US-China trade dispute, Malaysia’s growth performance remained resilient in Q2 2019,” she told reporters during Bank Negara’s Q2 2019 briefing here, today.
Nor Shamsiah said growth in the manufacturing sector improved marginally, supported by better performance of domestic-oriented industries.
The services sector continued to expand amid sustained growth in the wholesale and retail subsectors.
She said for the quarter, headline inflation averaged higher, mainly reflecting the lapse in the impact of the Goods and Services Tax’s (GST) zerorisation that was implemented in June 2018.
Core inflation, excluding the impact of consumption tax policy changes, was unchanged at 1.6 per cent.
Moving forward, Nor Shamsiah said overall, the baseline projection is for the Malaysian economy to grow between 4.3 per cent and 4.8 per cent in 2019.
She said growth is expected to remain supported by private sector activity.
Nor Shamsiah added that the external sector is likely to continue to be affected by slower global growth amid ongoing trade tensions.
The central bank also expects the headline inflation rate in the second half of 2019 to average higher compared to the first half, following the lapse in the impact of consumption tax policy changes.
Underlying inflation is expected to remain stable, supported by the continued expansion in economic activity and in the absence of strong demand pressures.