Malaysia's GDP Expected To Come In At 5.1 Pct In 2024 - HLIB Research

KUALA LUMPUR, Feb 13 -- Malaysia’s economic growth is expected to be positive with a 5.1 per cent growth year-on-year (y-o-y) in 2024, in line with advance estimate and within the Finance Ministry's (MoF) official target of between 4.8 per cent and 5.3 per cent y-o-y, said Hong Leong Investment Bank (HLIB Research). 

For the fourth quarter of 2024 (4Q 2024), it has anticipated gross domestic product (GDP) to grow by 5.0 per cent y-o-y, supported by continued expansion in the services, manufacturing and construction sectors. 

"We expect growth in the services sector to gain momentum, in line with the stronger volume index of services showing for 4Q with a 6.0 per cent growth y-o-y. 

"On the flip side, the manufacturing sector is expected to ease, with manufacturing Industrial Production Index (IPI) moderating with a 4.5 per cent growth y-o-y against 5.8 per cent in the previous quarter," it said in a note today.

On the expenditure front, private consumption is expected to remain supportive of overall growth, lifted by a strong labour market with a December 2024 unemployment rate of 3.1 per cent, and sustained wage growth in services with 3.9 per cent growth and manufacturing sector, 1.7 per cent y-o-y.

Nevertheless, the overall growth is expected to be weighed down by slower export activity (+7.3 per cent y-o-y) due to rising concerns over global trade policies, it said. 

The full 4Q 2024 GDP print will be released on Feb 14, 2025.

For 2025, Malaysia’s economic growth is expected to ease slightly to 4.9 per cent y-o-y, supported primarily by sustained household spending on the back of a stable labour market and boosted further by supportive income measures, such as the national wage hikes and Employees' Provident Fund (EPF) Account 3 withdrawals. 

"Nevertheless, downside risks to growth remain, in light of the uncertain global policy environment," it said. 

Meanwhile, Maybank Investment Bank Bhd (Maybank IB) estimated 4Q 2024's GDP growth at 4.9 per cent y-o-y. 

It said the last quarter of 2024 saw a pickup in the Index of Services (4Q 2024: +6.1 per cent versus 5.6 per in 3Q 2024 y-o-y) and sustained growth momentum in construction works value (4Q 2024: 23.1 per cent y-o-y; 3Q 2024: 22.9 per cent y-o-y) amid softer industrial production index and decline in crude palm oil output. 

-- BERNAMA