KUALA LUMPUR: The Malaysian economy registered a stronger growth of 14.2 per cent in the third quarter(Q3) of 2022 from 8.9 per cent in Q2 2022, underpinned by continued expansion in domestic demand.
The 14.2 per cent is the fastest gross domestic product (GDP) pace posted by any Southeast Asian nation during the period, surpassing Vietnam's 13.7 per cent.
Bank Negara Malaysia governor Tan Sri Nor Shamsiah Mohd Yunus said while there were base effects from the negative growth in Q3 2021, the growth was also underpinned by improvements in labour market and income conditions, as well as ongoing policy support.
Nor Shamsiah said the country's exports remained supported by strong demand for electronic and electrical (E&E) products.
"The recovery of inbound tourism lent further support to economic activity. By sector, the services and manufacturing sectors continued to drive growth.
"On a quarter-on-quarter seasonally-adjusted basis, the economy grew by 1.9 per cent from 3.5 per cent in Q2 2022. Overall, the Malaysian economy expanded by 9.3 per cent in the first three quarters of 2022," she told reporters after a briefing on Malaysia's latest GDP numbers here today.
Nor Shamsiah said headline inflation was likely to have peaked for the year at 4.5 per cent during the quarter from 2.8 per cent in Q2 2022, while core inflation increased further to 3.7 per cent from 2.5 per cent in Q2 2022.
As expected, she said the increase in headline inflation was largely driven by the base effect from the discount on electricity bill implemented in the third quarter of 2021, as well as sustained increases in core inflation and price-volatile items.
"The inflationary pressures reflected the confluence of elevated cost pressures, particularly for food-related items, and strong demand conditions," she said.
Moving into 2023, Nor Shamsiah said headline and core inflation were expected to remain elevated amid both demand and cost pressures, as well as any changes to domestic policy measures.
She said additional upward pressures to inflation will remain partly contained by the existing price controls, subsidies, and the remaining spare capacity in the economy.
"The balance of risk to the inflation outlook in 2023 is tilted to the upside and continues to be subject to domestic policy measures on subsidies, as well as global commodity price developments arising mainly from the ongoing military conflict in Ukraine and prolonged supply-related disruptions," she added.