KUALA LUMPUR, Oct 13 — The slower production in the manufacturing sector is expected to persist in the near term, looking at the present trend in the global manufacturing Purchasing Managers’ Index (PMI), which remained under the contractionary level, including for Malaysia, said AmBank Research today.

In a research note, it said factors contributing to this include subdued production, limited new orders, and a decline in new export orders, though at a slower pace.

"On a positive note, the reading for China and the US, which are among Malaysia’s largest trading partners, rebounded into the favourable territory, and if this situation persists, it may indicate that the worst is already behind us,” it added.

Against this backdrop, AmBank Research reiterated its gross domestic product (GDP) forecast of 4.0 per cent for 2023 and expects the economy to grow by 4.5 per cent in 2024.

It noted that domestically, the manufacturing PMI has been in contraction for 13 consecutive months.

Malaysia’s industrial production index (IPI) declined by 0.3 per cent in August from a growth of 0.7 per cent in July 2023. Sector-wise, the manufacturing sector contracted by 0.6 per cent, while production in the mining sector increased by 0.1 per cent, and electricity production accelerated to 1.9 per cent.

Meanwhile, Public Investment Bank envisaged a pronounced deceleration in the IPI growth, primarily attributable to the unforeseen and protracted softness in global demand. — Bernama