Malaysian economy growth outlook revised to 4.8 pct from 4.2 pct

Posted on: 2017-07-03


KUALA LUMPUR: OCBC Bank has revised its growth outlook for the Malaysian economy from 4.2 per cent to 4.8 per cent for this year, saying its outlook looks conservative after the strong 5.6 per cent growth print in the first quarter.

This was due to a baseline expectation that global trade will still proceed apace in the second half looks to be a rational one at this point.

Initially, it expected 2017 to be a tough year for export dependent Malaysia due to the protectionist politics in the developed world would impede global trade flows.

“Fortunately, as it turns out, such dejected despair has not been warranted,”the research house said, in a report on its second half outlook for 2017.

“While there remains some risks that whatever fears of protectionism that we had earlier this year may yet pop up as an unpleasant surprise, a baseline expectation that global trade will still proceed apace in the second half looks to be a rational one at this point.”

Despite the new US government’s protectionism messages, global trade flows actually picked up rather encouragingly.

Against this backdrop, instead of being dragged down by a massive global trade slowdown, Malaysia’s economy was in fact boosted by the pleasant surprise of robust trade flows.

Exports grew strongly in the first quarter of the year, by an average of 21.4 per cent year-on-year per month.

“The strong momentum appears to have some tailwinds to it still, with April’s print coming in at a still-commendable 20.6 per cent year-on-year.”

The strong exports appear to have been driven by good demand for Malaysia’s manufactured goods, including semiconductor devices while the recovery in both the prices and demand volume for commodities such as crude oil, LNG and rubber has also contributed to the encouraging upturn.

“Apart from help from external factors aside, the economy has also received a fillip from domestic consumption.”

It was referring to private investment which grew by 12.9 per cent year-on-year in the first quarter compared to 4.9 per cent year-on-year in the previous quarter.

Private consumption continued to power on with a 6.6 per cent year-on-year in the first quarter this year, compared to 6.1 per cent year-on-year in the fourth quarter.

The central bank also recently said growth will be mainly driven by domestic demand amid continued wage and employment growth, and the implementation of new and on-going investment projects.


Share:

Source From: NST

Other News & Articles


Understanding Property Investment Basics to Get You Started

Investing in property can be a great way to build your net worth, diversify your investment portfolio, generate cash flow, or build your retirement fund....

Posted on: 2019-10-23

Lower Property Price Ceiling for Foreigners: Crunch Your Numbers Here

PETALING JAYA: The Budget 2020 announcement that the threshold for foreign ownership of high rise property would be lowered from RM1mil to RM600,000 caught many by surprise....

Posted on: 2019-10-23

Budget 2020 Real Estate Highlights

To assist those who are unable to pay 10% deposit and to secure the access of home purchase financing, the government will be working with financial institutions to introduce a Rent-To-Own (RTO)...

Posted on: 2019-10-15