HLIB Research sees further improvement in Malaysia’s trade

KUALA LUMPUR: Hong Leong Investment Bank Bhd (HLIB Research) said steady commodity prices and the global manufacturing sector’s rebound, which is demonstrated by the purchasing managers index for manufacturing and semiconductor sales, should lead to further improvements in Malaysia’s trade.

Exports of produced goods and goods related to commodities have improved, according to the research firm.

“Manufactured exports saw a recovery, driven by increased exports of machinery, equipment, metals, optical devices and chemical products.

“The decline in exports of electrical and electronics (E&E) also slowed down, reflecting a global increase in semiconductor sales.”

Commodity-related exports, including petroleum products, palm oil and rubber, saw growth, offsetting declines in crude petroleum and liquid natural gas exports, said HLIB Research.

“Import growth accelerated across different categories, including capital goods, intermediate goods and consumption goods.”

The firm also noted that January exports saw a significant improvement, growing by 8.7 per cent compared to the previous year, bouncing back from a 10-month decline.

“This surpassed the expected 3.0 per cent growth. Imports also increased by 18.8 per cent year-onyear, showing strong momentum compared to the previous month’s 2.9 per cent growth.”

It said both exports and imports increased on a monthly basis, although the rise in imports was higher (5.3 per cent) than that of exports (3.4 per cent), resulting in a slightly smaller trade surplus of RM10.1 billion compared to RM11.7 billion in December.

Exports to major markets like the United States, Japan, European Union and Asean rebounded, but exports to China declined further due to lower exports of E&E products.

HLIB Research said in January, Malaysia’s trade performance saw an improvement, aided by the presence of more working days compared to the previous year.

“Following this, we maintain our expectation for gross domestic product to grow 4.8 per cent year-on-year in 2024,” it added.