PETALING JAYA, July 8 — Malaysia’s exports grew slower for the fourth straight month in May due to softening global orders, even as the central bank moved to curb burgeoning household debt spending that has part-driven the country’s domestic demand.

According to the Business Times, exports growth slipped unexpectedly to 5.8 per cent annually while imports also dropped by 2.3 per cent in the same period.

Last month, the Ministry of International Trade and Industry (MITI) had warned that the country’s trade growth would likely fall to 1.8 per cent for the first four months of the year, citing weaker international demand and lower commodity prices.

“We expect Malaysia’s exports to remain soft in June to August, weighed down by the shorter working period and soft international commodity prices,” CIMB Investment Bank regional economist Lee Heng Guie was quoted as saying by the Business Times.

On Friday, Bank Negara Malaysia announced immediate measures to arrest the country’s soaring household debt problem, including tightening lending procedures by narrowing loan tenures for personal financing and property purchases.

Yeah Kim Leng, group chief economist with financial firm RAM Holdings, told the AFP news agency that the “mild credit tightening” is designed to curb household debt from rising excessively.

“Some consumers are borrowing to the hilt. The government wants to slowdown excessive borrowings and curb property speculation,” he said.

Malaysia’s household debt to GDP ratio has been steadily increasing from 75.8 per cent in 2010 to 76.6 per cent in 2011 and to 80.5 per cent in 2012.

In March, BNM governor Tan Sri Dr Zeti Akhtar Aziz said the central bank was supervising the country’s household debt after the ratio breached the 80 per cent mark last year.

The central bank, however, said households who have the financial capacity to take on borrowings will continue to enjoy access to financing.

Yeah also ruled out possible interest rate hike as this painful move will hurt growth in the export dependent country amid the weak global economy.

Last year, Malaysia’s total trade stood at RM1.3 trillion after it went up by 3 per cent from the previous year’s trade of RM1.27 trillion.

Malaysia’s main trade partners in 2012 are ASEAN, China, Japan, the European Union (EU) and US.

The country’s economy is expected to grow 5-6 per cent this year powered by strong domestic demand.