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Malaysia economy grows 4.3%, snapping slowing trend

Bank Negara said gross domestic product grew 4.3 percent in July-September, faster than the 4.0 percent predicted in a Bloomberg News poll as private domestic consumption offset weak government spending.

However, it warned of further economic headwinds ahead.

“Overall, while domestic conditions remain resilient, uncertainties in the external environment may pose downside risks to Malaysia’s growth prospects,” the central bank said.

Energy-exporting Malaysia has the third-largest economy in Southeast Asia, but has been grappling with falling oil prices and weak overseas demand.

Growth in the second quarter of this year was 4.0 percent, the slowest since 2009.

The country has also been rocked by a massive financial scandal centring on allegations that billions of dollars were stolen from a state investment fund overseen by Prime Minister Najib Razak, who denies wrongdoing.

In July, Malaysia unexpectedly cut interest rates for the first time in seven years to help spur growth.

In a 2017 budget unveiled last month, Najib announced new cash assistance for the poor, civil-servant pay rises to help stoke consumption, and plans for more infrastructure projects.

The World Bank has forecast Malaysian full-year growth below five percent this year and next.