Malaysia's economy likely grew 3.4% year-on-year in the fourth quarter of 2023, slightly faster than the previous three-month period, official advance estimates showed on Friday.

The pace of expansion in the October-December period was led by the services sector which grew 4.7% on-year in the quarter, the Statistics Department said in a statement.

All other sectors including construction, manufacturing, mining and agriculture also registered growth, the department said.

In the third quarter of 2023, gross domestic product (GDP) had expanded 3.3% as strong domestic demand offset a slump in exports. Malaysia's exports, which have been in decline since March, contracted 8% in 2023, according to trade data released separately on Friday.

The department began releasing preliminary estimates on quarterly economic performance in October last year, citing demand for more timely statistics and to comply with international best practices.

Malaysia's full-year economic growth is expected to come in at 3.8% in 2023, the department said, below the government's projection of a 4% expansion.

The government and central bank expect economic growth of 4%-5% in 2024.

Final fourth quarter and 2023 GDP figures are expected to be released on Feb. 16.

(Reporting by Rozanna Latiff; Editing by Kanupriya Kapoor)