Malaysia’s Economy Grew by 5% in Q4 2024, Driven by Domestic Demand

Malaysia’s economy expanded by 5% in Q4 2024 (Q3 2024: 5.4%), primarily supported by strong domestic demand and robust investment activity. Household spending remained resilient due to positive labour market conditions and policy support. Exports continued to grow, though import growth moderated. Sector-wise, the services and manufacturing industries led the expansion, while construction recorded double-digit growth. However, the commodities sector contracted due to lower oil palm and oil production. On a quarter-on-quarter basis, GDP declined by 1.1% (Q3 2024: +1.9%).

For the full year 2024, GDP grew by 5.1% (2023: 3.6%), supported by strong household spending, investment growth, and a recovery in exports. Key national initiatives, such as the New Industrial Master Plan and National Energy Transition Roadmap, also contributed to economic expansion. The current account surplus stood at 1.7% of GDP (2023: 1.5%).

Inflation Declined in 2024

Headline inflation eased to 1.8% in Q4 2024 (Q3 2024: 1.9%), mainly due to lower prices for mobile communication services and RON97 petrol, despite an uptick in food-related costs. Core inflation also dropped to 1.7% (Q3 2024: 1.9%). For 2024 as a whole, both headline and core inflation stood at 1.8% (2023: 2.5% and 3.0%, respectively).

Ringgit Appreciated Against the US Dollar

The ringgit appreciated by 2.7% against the US dollar in 2024, making it one of the few Asian currencies to strengthen, alongside the Hong Kong dollar and Thai baht.

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