House­hold in­come grow­ing at slower pace

The Star Malaysia - StarBiz - - News -

PETALING JAYA: The pace at which house­hold in­come grew slowed down last year com­pared with the 2012-2014 pe­riod based on data from the Sta­tis­tics Depart­ment, ac­cord­ing to Malaysian Rat­ing Corp Bhd (MARC).

The rat­ing agency said in a re­port that both the me­dian and mean monthly house­hold in­come growth had slowed from the pace of 11.7% and 10.3% recorded in the previous sur­vey. Both mea­sures were also lower than the in­creases recorded in the sur­vey dur­ing the 2009-2012 pe­riod, it said.

“This slower pace can be pos­si­bly at­trib­uted to the chal­leng­ing do­mes­tic and global eco­nomic en­vi­ron­ments post the global fi­nan­cial cri­sis, col­lapse in in­ter­na­tional crude oil prices, de­pre­ci­a­tion of the ring- git, as well as the weaker global trade per­for­mance dur­ing the pe­riod,” it said.

“It is also no­table that the me­dian in­come growth in ru­ral ar­eas fell 8.5 per­cent­age points to 5.3% per an­num in 2014-2016 from the high of 13.8% recorded in the 2012-2014 pe­riod.”

Along­side the lat­est re­lease of Malaysia’s house­hold ex­pen­di­ture sur­vey, MARC es­ti­mated that the av­er­age monthly house­hold ex­cess in­come grew at a slower pace of 6.6% last year from a cycli­cal high of 7.7% in 2013.

Sim­i­larly, on an in­fla­tion-ad­justed ba­sis, the growth of the monthly house­hold ex­cess in­come moder­ated to 6.6% dur­ing the same pe­riod, down from an av­er­age of 7.1% in the three-year pe­riod through 2015.

“This has re­in­forced our view that con­sumers have been cau­tious in their spend­ing habits amid a chal­leng­ing eco­nomic en­vi­ron­ment, as well as the ris­ing cost of liv­ing.

“Not sur­pris­ingly, pri­vate con­sump­tion growth has been sub­dued, av­er­ag­ing at 6.3% be­tween 2014 and 2016, down from 7.5% in the pre­ced­ing three-year pe­riod,” it said.

How­ever, MARC noted that based on the lat­est Sta­tis­tics Depart­ment data, Malaysia’s av­er­age and me­dian house­hold in­comes ben­e­fit­ted from the rel­a­tively re­silient do­mes­tic econ­omy. It noted that the av­er­age monthly house­hold in­come rose by 6.2% per year on a com­pounded an­nual growth rate ba­sis be­tween 2014 and 2016.

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