KUALA LUMPUR, Jan 11 — MIDF Research expects Malaysia’s retail trade to expand by 7.5 per cent in 2024 on the back of resilient consumer demand amid a healthy labour market and softening inflation pressure.

The research house said that in the first 11 months of 2023, Malaysia’s distributive trade sales increased by 7.9 per cent year-on-year (y-o-y), with retail trade rising 9.4 per cent.

Other components of distributive trade also improved, including sales of motor vehicles (up 13.0 per cent y-o-y) and wholesale trade (up 5.3 per cent y-o-y).

Consumer demand remained firm and resilient as reflected in the distributive trade sales performance, it said.

"Moving forward, the upbeat momentum of domestic demand is expected to continue in 2024 underpinned by a resilient labour market, stable inflationary pressure, pick-up in tourism activities, and supportive and accommodative economic policies,” MIDF Research said in a note.

In November 2023, Malaysia’s distributive trade posted a growth of 6.2 per cent y-o-y, the slowest expansion rate since July 2023.

On a month-on-month basis, non-seasonally-adjusted distributive trade inched up 0.2 per cent.

By component, sales of motor vehicles continued its strong momentum with a 12.7 per cent y-o-y growth, while wholesale trade rose by 6.2 per cent and retail sales swelled by 4.4 per cent.

In terms of seasonally-adjusted volume, distributive trade, retail trade and motor vehicles increased by 4.7 per cent, 1.0 per cent and 10.6 per cent y-o-y, respectively.

Meanwhile, the unemployment rate hit a new post-pandemic low of 3.30 per cent in November 2023.

"Looking ahead, we foresee a sanguine domestic outlook for the fourth quarter of this year and 2024 amid better pick-up in tourism activities and supportive and accommodative economic policies from both fiscal and monetary sides,” MIDF Research said. — Bernama