Sur­prise fig­ures led by man­u­fac­tur­ing sec­tor point to im­proved eco­nomic out­look for sec­ond quar­ter

New Straits Times - - Business - RUPA DAMODARAN KUALA LUMPUR bt@me­di­aprima.com.my

MALAYSIA’S in­dus­trial out­put rose by a sur­pris­ing four per cent year-on-year in June, led by man­u­fac­tur­ing ac­tiv­i­ties — point­ing to im­proved eco­nomic out­look for the sec­ond quar­ter.

Re­search houses are now ex­pect­ing the sec­ond quar­ter (April to June) to record a more than five per cent growth.

UOB Bank econ­o­mist Ju­lia Goh ex­pects gross do­mes­tic prod­uct (GDP) growth to hit 5.5 per cent in the sec­ond quar­ter.

This was based on the man­u­fac­tur­ing out­put, which grew 6.2 per cent, ser­vices ac­tiv­ity (seven per cent), crude palm oil out­put (12.3 per cent) and con­struc­tion work (11.2 per cent).

“Given a ro­bust do­mes­tic de­mand and ex­ter­nal trade, Bank Ne­gara (Malaysia) is likely to re­vise up­wards this year’s growth out­look when the sec­ondquar­ter results are re­leased next Fri­day,” said Goh.

Bank Ne­gara’s cur­rent GDP pro­jec­tion is 4.3 to 4.8 per cent.

The Statis­tics Depart­ment said the man­u­fac­tur­ing sec­tor recorded a 4.7 per cent growth in ac­tiv­i­ties, with most of the out­put com­ing from elec­tri­cal and elec­tron­ics (E&E) at 8.3 per cent, food, bev­er­ages and to­bacco (6.7 per cent); and petroleum, chem­i­cal, rub­ber and plas­tic prod­ucts (2.8 per cent).

In June, the min­ing sec­tor out­put rose 2.4 per cent fol­low­ing a 0.7 per cent in­crease in crude oil and 4.4 per cent in nat­u­ral gas.

Elec­tric­ity out­put in­creased by 2.1 per cent in June af­ter an in­crease of 2.5 per cent in May.

Mean­while, the man­u­fac­tur­ing sec­tor recorded an 11.5 per cent growth in sales, ris­ing to RM62.3 bil­lion, com­pared with RM55.8 bil­lion a year ago.

Year-on-year, the sig­nif­i­cant in­crease in sales value was due to the in­crease in E&E (15.4 per cent) petroleum, chem­i­cal, rub­ber and plas­tic prod­ucts (15.3 per cent) and non-me­tal­lic min­eral prod­ucts, ba­sic metal and fab­ri­cated metal prod­ucts (5.7 per cent).

Al­liance Bank said the sec­ondquar­ter growth could have been ro­bust at around 5.2 per cent with the man­u­fac­tur­ing sec­tor mo­men­tum, along with a ro­bust man­u­fac­tur­ing ex­ports per­for­mance.

But it said while in­dus­trial pro­duc­tion re­mained sta­ble with the three-month mov­ing av­er­age hov­er­ing above the four per cent ex­pan­sion level, ac­tiv­i­ties were likely to mod­er­ate in the sec­ond half of the year.

“The man­u­fac­tur­ing sec­tor mo­men­tum will likely slow down, given the con­trac­tionary Pur­chas­ing Man­agers’ In­dex and global un­cer­tain­ties.”

Newspapers in English

Newspapers from Malaysia

© PressReader. All rights reserved.