Malaysian Economy Contracts 0.5% in 1Q 2021, Improving From the 3.4% Contraction in 4Q 2020

In the first quarter of 2021 (1Q 2021), the economy of Malaysia saw a 0.5% year-on-year (YoY) contraction, which, although negative, was still an improvement from the 3.4% YoY contraction in the fourth quarter of 2020 (4Q 2020).

Why it Matters?

All economic sectors saw improvement in 1Q 2021, led by the manufacturing sector, which grew 6.6% YoY compared with its 3.0% rise in 4Q 2020. Governor of Bank Negara Malaysia, Datuk Nor Shamsiah Mohd Yunus, stated that even though there is now a third round of a movement control order (MCO 3.0), the country’s gross domestic product (GDP) growth is likely to remain at 6.0%-7.5% in 2021. This is largely due to the fact the MCO 3.0 is focused on curbing social activities, with almost all economic sectors be...