Q3 growth at 4.7%, slowest in two years
Malaysia's economy grew 4.7 percent in the third quarter from a year ago, its slowest rate in over two years, but meeting analyst expectations.
Its current account surplus narrowed to RM5.1 billion (US$1.17 billion) in the period from RM7.6 billion in the previous three months, its lowest since the second quarter of 2013.
Growth has been on a downtrend this year, having expanded by 5.6 percent in the first quarter and 4.9 percent in the second quarter.
"Although the economy is facing a considerable number of shocks, it has remained resilient as reflected by the steady growth performance of our economy," Bank Negara Malaysia governor Zeti Akhtar Aziz (
photo
) told a news conference.
"Current situation warrants, however, a high degree of alert but not alarm."
Growth was is line with a 4.7 percent projection, according to a Reuters poll of economists, who saw weakness in domestic consumption as the main reason for a slowing.
South-East Asia's third largest economy has had to weather multiple risks to growth this year, from falling commodity prices, dampening demand from China and uncertainties in domestic politics.
The ringgit has been Asia's worst performing currency this year, losing almost 20 percent. Ringgit stayed flat, ranging from RM4.3770 to RM4.3820 to the US dollar after the GDP data was released.
Zeti has said the ringgit is significantly undervalued at the current levels.
"It does not reflect the country's fundamentals as the current account remains in surplus, unemployment remains low and inflation is within Malaysia's long-term average," she said.
Exports jumped in September, rising more than twice the forecast on the back of a weaker ringgit and demand for electrical and electronic products from the US and Europe.
Malaysia's exports and imports were up 3.2 percent in quarter, the data showed.
Inflation was at three percent in the third quarter, and is expected to peak in the first quarter of next year before moderating.
1MDB pressed for answers
Investor sentiment has been hurt by alleged graft and mismanagement at state investor 1Malaysia Development Bhd (1MDB).
The scandal has rocked Malayia's politics, with the opposition parties and critics of Prime Minister Najib Abdul Razak asking for him to step down over the scandal.
Bank Negara has urged the country's attorney-general to begin criminal prosecution of 1MDB after completing its investigation, but the call was rejected.
Zeti said the bank will continue to request for information from 1MDB and if not given, the fund's subsequent requests for approval can be rejected.
- Reuters
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