The Malaysian economy expanded by 4.7 percent year-on-year in the September quarter of 2015, moderating from a 4.9 percent growth in the previous period and in line with market expectations. It is the weakest expansion since the second quarter of 2013, as a rebound in exports were unable to offset a slowdown in private and public consumption.
On the expenditure side, private consumption grew by 4.1 percent year-on-year, slowing from a 6.4 percent growth in the previous quarter, as households continued to adjust the implementation of the Goods and Services Tax. Public consumption expanded by 3.5 percent, slowing from a 6.8 percent growth in the June quarter, due to slower growth in both emoluments and supplies and services expenditure.
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Private investment rose 5.5 percent, accelerating from a 3.9 percent rise in the previous three months, driven by capital spending in the manufacturing and services sectors. Public investment turned around to record a positive growth, due to an improvement in spending on fixed assets by both the Federal Government and public enterprises.
Exports grew by 3.2 percent, following a 3.7 percent drop in the preceding quarter. Imports also rose 3.2 percent, after registering a 2.8 percent rise in April to June.
On the production side, a slowdown was seen for: services sector (+4.4 percent from a 5.0 percent growth in the June quarter), mining sector (+5.3 percent from +6.0 percent) and agriculture (+2.4 percent from +4.6 percent). Meanwhile, construction sector grew the most by 9.9 percent (after a 5.6 percent growth), mainly due to a faster expansion in civil engineering and specialized construction activities sub-sectors. The manufacturing sector also rose 4.8 percent, accelerating from a 4.2 percent in the second quarter, supported by an improvement in an export-oriented industries.
Moving forward, Malaysia's GDP is expected to expand within the target of 4.5 percent to 5.5 percent this year. For 2016, the GDP growth is projected to be between 4.0 percent to 5.0 percent. Domestic demand will continue being a key driver of growth and suported mainly by private sector.
On a quarter-on-quarter seasonally-adjusted basis, the economy grew by 0.7 percent, slowing from a 1.1 percent expansion in the previous three months.