Malaysia's economy is expected to grow at a slower than anticipated rate this year due to high crude oil prices and a still fragile electronics sector, an independent think tank said today.

The Malaysian Institute of Economic Research (MIER) said it was lowering its gross domestic product (GDP) growth estimate to 4.9 percent from 5.1 percent predicted earlier. This is their second adjustment this year.

"Our surveys showed that consumer and business sentiment has been dented somewhat in the third quarter, although the indices still suggest modest growth.

"Barring clearer signs of improvement, the Malaysian economy is unlikely to perk up as fast as expected," MIER executive director Mohamad Ariff Kareem said at an economic briefing.

2006 growth projection stays

However, he said the Malaysian economy would benefit from a rebound in the electronics sector and higher commodity prices.

"We see no compelling reasons to revise our earlier GDP growth forecast of 5.3 percent for 2006," he said.

Malaysia last month downgraded its 2005 economic growth forecast to 5.0 percent, the lower end of the 5.0-6.0 percent tipped earlier this year and well down on the 7.1 percent expansion in 2004.