The Malaysian economy expanded at a slower pace in the first quarter, as the country's exports remained under pressure from weakening external demand, data released by the Bank Negara Malaysia showed Wednesday.

Gross domestic product increased 4.7 percent on an annual basis in the first quarter, notably slower than the 5.2 percent growth recorded in the fourth quarter. Economists expected the growth rate to weaken to 4.6 percent.

Public consumption expenditure increased at sharply slower rate of 5.9 percent in the first quarter than the fourth quarter's 22.9 percent gain. Investment climbed 16.1 percent annually during the three-month period, faster than the 8.4 percent rise seen in the previous quarter.

Malaysia's headline inflation slowed to 2.3 percent in the first quarter from 3.2 percent in the fourth quarter. In April 2012, inflation eased to 1.69 from 2.1 percent in March, and came in below expectations.

The central bank early this month retained its policy rate at 3 percent for the sixth consecutive session, citing strong domestic demand that continues to support growth. The bank forecast Malaysia's headline inflation to moderate in 2012 amid improvement in domestic supply and stable demand conditions.

RTTNews