BUSINESS SENTIMENT FOR Q2 IMPROVES
KUALA LUMPUR: Business sentiments in Malaysia have inched upwards for the first time since the second quarter of last year (Q2 2016), according to Dun & Bradstreet (D&B) Malaysia’s Business Optimism Index (BOI) study.
The firm said the overall BOI rose from 1.65 percentage points in Q1 2017 to 3.07 percentage points in Q2 2017. On a year-onyear (y-o-y) basis, BOI moderated downwards from the 5.83 percentage points in Q2 2016.
“The second quarter of 2017 looks set to see a continuation of the cautious optimism expressed by the business community in Malaysia since Q1 2016,” said chief executive officer of Dun & Bradstreet (Malaysia) Sdn Bhd, Audrey Chia in a statement.
“The government’s continued investments in public transportation projects and the modest uptick in manufacturing activities are expected to bolster commercial confidence within both transportation and manufacturing sectors in the coming months.
“However, we are still seeing signs of weakness in the financial sector despite the slight improvements in the outlook for Q2. We expect the outlook for the sector to remain muted with the ringgit being caught in a vicious circle of intervention and depreciation as well as a slowdown in both corporate borrowing and household loan growth in the near-term,” Chia added.
Breaking it down by sectors, the transportation sector has emerged as the most optimistic sector with six indicators each in the expansionary region.
Net profits and employment levels within the transportation have both climbed from five percentage points in Q1 2017 to 15.0 percentage points and 10 percentage points, respectively, in Q2 2017. Both volume of sales and new orders are expected to be moderately optimistic at +5.0 percentage points in Q2 2017.
Inventory levels are expected to jump from 0 percentage point in Q1 2017 to five percentage points in Q2 2017. Selling prices are expected to remain marginally optimistic at 10.0 percentage points in Q2 2017.
The agricultural sector also emerged as one of the most optimistic sectors with six indicators in the expansionary region.
Employment levels have jumped from 20.0 percentage points in Q1 2017 to 80.0 percentage points in Q2 2017.
Volume of sales, net profits and new orders are expected to remain expansionary at 40.0 percentage points in Q2 2017. Selling price and inventory levels registered 80.0 percentage points in Q2 2017.
Overall, all six indicators of the BOI study which include volume of sales, net profits, selling price, inventory level, employees and new orders, moderated upwards on a quarter-on-quarter basis.