Bet­ter pro­duc­tion num­bers, export or­ders to boost per­for­mance

New Straits Times - - Business -


IM­PROV­ING pro­duc­tion num­bers and export or­ders cou­pled with a more pos­i­tive out­look by busi­nesses will likely see a spike in eco­nomic activities in the first quar­ter of this year.

Affin Hwang Cap­i­tal Re­search ex­pects the real gross do­mes­tic prod­uct (GDP) growth to re­cover stronger from 4.5 per cent yearon-year in the fourth quar­ter of last year to above five per cent in the first quar­ter of this year.

Bank Ne­gara Malaysia will re­lease the first quar­ter GDP details on May 19.

On Tues­day, Malaysia’s man­u­fac­tur­ing Pur­chas­ing Man­agers’ Index (PMI) rose to 50.7 last month, from 49.5 in March, ris­ing above the 50-level for the first time since March 2015, in­di­cat­ing stronger ex­pan­sion and growth mo­men­tum.

This short-term lead­ing in­di­ca­tor, added Affin Hwang Cap­i­tal, has been track­ing closely the coun­try’s per­for­mance in the man­u­fac­tur­ing sec­tor as well as ex­ports of man­u­fac­tured goods.

“The trends in Malaysia’s monthly PMI was also con­sis­tent with the coun­try’s lead­ing index (LI) — an in­di­ca­tor de­signed by the Sta­tis­tics De­part­ment to pre­dict the di­rec­tion of the eco­nomic ac­tiv­ity — that rose from 0.5 per cent year-on-year in Jan­uary to 0.8 per cent in Fe­bru­ary,” com­mented econ­o­mist Alan Tan.

The re­search house is con­fi­dent that Malaysia’s ex­ports, which rose sharply from 13.6 per cent year-on-year in Jan­uary to 26.5 per cent in Fe­bru­ary, will likely re­main strong in the first half of the year.

The re­port also noted that apart from out­put and new or­ders, all the other ma­jor com­po­nents, namely employment, sup­pli­ers’ de­liv­ery times and stocks of pur­chases, im­proved in April.

The re­search house ex­pects the econ­omy to grow by 4.4 per cent this year but ex­pects to re­vise the pro­jec­tion after the re­lease of the first-quar­ter GDP re­sults.


Malaysia’s ex­ports, which rose from 13.6pc in Jan­uary to 26.5 per cent in Fe­bru­ary, are likely to re­main strong, says Affin Hwang Cap­i­tal Re­search.

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