Oct exports likely to expand 10.8pc
KUALA LUMPUR: RAM Rating Services Bhd says Malaysia’s exports may have grown 10.8 per cent in October.
This is on the back of global value-chain activities, which were likely sustained by front-loaded orders, amid greater concerns over the increase in United States tariff rates on US$200 billion (RM826 billion) of Chinese imports earlier scheduled to take effect on January 1.
The rating agency said the increase was now put on hold following talks between President’s Donald Trump and his counterpart Xi Jinping at the Group of 20 summit in Buenos Aires, Argentina, where both parties had agreed to a 90-day truce to allow time for fresh negotiations.
“Although this pauses an escalation of the trade war for now, uncertainties still cloud external demand prospects.
“As such, the current frontloaded demand momentum could taper off temporarily in the lead-up to the end of the 90-day window next February,” said its head of research Kristina Fong.
RAM Ratings said in line with the expected sustained external demand, Malaysia’s import growth might have accelerated to 6.4 per cent in October, while the overall trade surplus could total RM14.3 billion.
Meanwhile, the rating agency said Malaysia remained an attractive destination for foreign direct investments, despite global volatility and uncertainty, as underlined by the increase in investment approvals in the first half, which should help stimulate more industrial activities and export growth over the longer term.