This was a significant increase compared with the 3.6% GDP growth recorded in 2023, though the 5% growth in Q4 was slightly lower than the 5.4% recorded in the previous quarter.

In a statement today, BNM said domestic consumption and strong investment activity were the main drivers of the nation’s growth.

Household spending remained stable thanks to a strong job market and the support of government policies, while investment activity was fuelled by major projects under the National Energy Transition Roadmap and the New Industrial Master Plan.

The services sector led the expansion, followed by manufacturing and construction, which saw double-digit growth.

However, the central bank said the commodities sector struggled because of a decline in palm oil and crude oil output, affecting the overall GDP growth.

Exports recovered due to the steady global growth, higher tourist numbers as well as the continued upcycle in the technology industry.

Inflation in the fourth quarter eased slightly to 1.8% from 1.9% in the previous quarter, with lower fuel and communication costs helping offset rising food prices.

BNM said the ringgit appreciated by 2.7% against the US dollar in 2024 but weakened in the final quarter because of global financial shifts.

It forecast steady growth in 2025, driven by investments, household spending, and stronger exports.

“Malaysia’s economic fundamentals remain strong, and ongoing reforms will support future growth,” said BNM governor Abdul Rasheed Ghaffour.

He said inflation was expected to remain manageable this year with the overall impact on inflation expected to be contained.