KUALA LUMPUR: Malaysia’s economy fell at a faster than anticipated clip in the fourth quarter, as more stringent coronavirus curbs crimped domestic intake and slowed the speed of healing, the reserve bank said on Thursday.
The economy contracted 3.4% year-on-year in the October-December period, succumbing to a third straight quarter and faster than the 3.1% decline forecast in a Reuters poll.
Malaysia’s full-year financial performance dipped 5.6% in 2020, the worst annual efficiency since the 7.4% decline in 1998 during the Asian Financial Crisis, according to data from the department of statistics.”Going into 2021, development will rebound, supported by a pickup in international need and normalisation in domestic economic activities,” Bank Negara Malaysia governor Nor Shamsiah Mohd Yunus said during a virtual news conference.Some economists have actually revised Malaysia’s 2021 development outlook below the variety of 6.5%-7.5% predicted by the federal government and central bank, as the Southeast Asian nation enforced a second lockdown to deal with a rise in coronavirus infections in recent weeks.Malaysia has seen its cumulative total of coronavirus infections shoot past 250,000 cases as of Wednesday, consisting of 923 deaths.”There have been numerous advancements, the resurgence of COVID and likewise progress with the vaccines … however importantly, we still anticipate development in 2021 to recover,” Nor Shamsiah said.Nor Shamsiah said financial policy will “remain accommodative in an environment of modest costs”, which the central bank has sufficient policy space to offer more support if needed.Last month, the reserve bank left its overnight policy rate at a record low of 1.75%. It cut its key rate by 125 basis points last year to prop up the coronavirus-hit economy.The trade-reliant economy had actually shown tentative signs of a rebound in the third quarter, driven by enhancing global need. Complete year exports fell 1.4%, though shipments began recuperating in the last 4 months of 2020. The central bank stated it expects inflation to pattern higher this year, after 10 straight months of decrease mostly due to low retail fuel prices.The heading customer prices index declined 1.2% in 2020.