The economy grew by 5.9 percent in the three months to June, outpacing 5.5 percent expansion in the previous quarter, the central bank said today.

Bank Negara governor Zeti Akhtar Aziz said the strong result was mainly led by the private sector, supported by the manufacturing and services sectors.

Zeti said private consumption recorded robust growth of 7.3 percent in the second quarter and was likely to stay strong in the second half of the year.

"The impact of the fuel hike in February and electricity tariffs hike in July has been largely reflected in the first half," she said.

For the first half of 2006, the economy grew by 5.7 percent from a year earlier.

The government has tipped economic growth of 6.0 percent in 2006, and under an ambitious 15-year industrial plan targets brisk economic growth of 6.3 percent over the period, driven by manufacturing as the star sector.

No change to monetary policy

Zeti said economic growth momentum will be sustained in the second half, with inflation expected to be moderate during the period. The central bank will maintain its current monetary policy stance in coming months, she said.

During the second quarter, manufacturing activities expanded by 8.4 percent year-on-year, compared with 3.1 percent growth in the same period last year, on the back of a recovery in the global semiconductor cycle.

The services sector registered growth of 6.0 percent year-on-year in the second quarter against 5.9 percent growth a year earlier.

The agriculture sector recorded growth of 5.8 percent year-on-year against negative growth of 1.5 percent in the corresponding period last year.

The mining sector continued to see contraction of 0.4 percent in the second quarter after a decline of 4.2 percent in the second quarter of last year.