KUALA LUMPUR, Nov 13 — The moderate growth in gross domestic product (GDP) of 4.7 per cent in the third quarter this year was largely due to the deceleration in private consumption, according to some economists.
Private consumption had dropped to 4.1 per cent from 6.4 per cent in the previous quarter, said Dr Yeah Kim Leng, dean of the Business School at the University of Science and Technology Malaysia.
“Consumer spending appears to have been more adversely impacted by the Good and Services Tax, weak commodity prices, job losses and the overall uncertainties facing the global and domestic economies,” he told Bernama today.
However, Yeah said, the turnaround in exports and better private investment performance helped arrest the slide in consumer sentiment.
Izzuddin Yussof, research economist at the Malaysian Industrial Development Finance Berhad (MIDF), said GDP growth was slightly below its forecast of 4.8 per cent but was still within its expectation.
“We had expected that private consumption would be the cause of the slowdown, while investment and net exports would rebound, particularly due to Malaysia’s strong export performance in August and September,” Izzuddin said.
He said the economy faced some challenges on domestic consumption and external uncertainty owing to the slowdown in China’s economy.
“The recent weakening of the ringgit has helped the exports industry, while putting further pressure on our domestic consumption,” Izzuddin said.
He said MIDF Research forecast GDP for the fourth quarter to be at 4.6 per cent, and at 5 per cent for the full year 2015.
“The economy is likely to start to rebound in the second quarter next year,” he said. — Bernama
