Malaysia’s economy grew at the fastest pace in two years last quarter, lifted by an export recovery and stronger private consumption and investment.
Gross domestic product (GDP) rose 5.6% from a year earlier, Bank Negara Malaysia said in a statement Friday. Growth was 4.5% in the fourth quarter.
The median estimate of 22 economists surveyed by Bloomberg was 4.8%.
Compared with the previous quarter, GDP rose 1.8% versus the 1.2% economists had forecast.
Malaysia’s economy is picking up speed, driven by household spending and a recovery in exports that’s helped by higher oil prices. The central bank forecast growth of as much as 4.8% this year from 4.2% in 2016.
Bank Negara Malaysia last week kept interest rates unchanged and said the growth momentum will be sustained this year. While there are risks including rapid credit growth among households and companies and rising prices, the ringgit has rebounded and foreigners are returning to the bond market.
Private sector demand, which makes up 70% of GDP, surged 8.2% in the first quarter from a year earlier, up from 5.9% in the previous three months, led by a jump in investment.
Government expenditure climbed 5.8%, rebounding from two quarters of contraction. Exports growth accelerated to 9.8% from 2.2% while growth in services quickened to 5.8% and manufacturing climbed 5.6%.