Kuala Lumpur: AmBank Group anticipates Malaysia's full-year gross domestic product (GDP) growth to reach 5.1 per cent in 2024, slightly above the previous estimate.

According to BERNAMA News Agency, this growth is expected to be driven by domestic expansion and a moderating inflation environment observed in the fourth quarter of last year (4Q 2024), as stated in a note released today. The bank also considers the overnight policy rate (OPR) at last year's level as neutral, aligning with Bank Negara Malaysia's (BNM) assessment, which supports economic growth.

This economic growth is reflected in consumer spending, evidenced by an increase in credit card disbursement (4Q2024: 6.3 per cent versus 3Q2024: 5.7 per cent) during the quarter. The group notes, "With the positive performance in the labour market, as the unemployment rate hits a decade-low of 3.1 per cent as of December 2024, we posit that the OPR will remain steady at 3.00 per cent in the near term."

On the supply side, the group highlights that the services sector led the growth in the quarter, showing a projected 5.5 per cent year-on-year increase, bolstered by the tourism sector as Malaysia recorded over 25 million international tourists in 2024, compared to 20.1 million in 2023. Additionally, the group foresees continuous double-digit growth in the construction sector during the quarter (4Q2024: 19.8 per cent versus 3Q2024:19.9 per cent), driven by data centre development, which contributed to the stronger performance in 4Q2024.

For 2025, the group projects Malaysia's full-year GDP growth at 4.6 per cent, with risks tilted to the downside due to external factors such as global economic uncertainties.