KUALA LUMPUR, Aug 16 — Malaysia’s superlative external trade performance, particularly its brisk exports, will continue to extend the country’s economic growth momentum in the next few quarters and prop up the ringgit in the near-term.
Malaysian Rating Corporation Bhd Economic Research Division Associate Director/Chief Economist Nor Zahidi Alias said the rating agency had revised Malaysia’s Gross Domestic Product (GDP) forecast.
“We are now revising our full year GDP growth to between 5.5 per cent and six per cent and there could possibly be the risk of another rate hike.
“We see this as positive for the ringgit in the near-term but expect challenges to re-emerge in the final quarter of the year when the effects of higher consumer prices continue to weigh on private consumption,” he told Bernama.
Bank Negara Malaysia today announced that the economy had expanded 6.4 per cent in the second quarter of the year against 6.2 per cent registered in the preceding quarter driven by higher exports and continued strength in private domestic demand.
Meanwhile, JF Apex Securities, in a note, said Malaysia’s GDP growth was better-than-expected and was above market consensus of 5.6 per cent and 5.8 per cent, respectively.
“Electric and Electronic (E&E) continued to spark the manufacturing sector. The manufacturing sector recorded a growth of 7.3 per cent, the highest reading since 3Q13, and the product remained the main growth contributor to the manufacturing sector,” it said.
E&E products recorded an increase of 11.4 per cent in line with global semiconductor sales which recorded a robust growth of 10.8 per cent, year-on-year, in 2Q14.
The other sub-sectors which recorded double-digit growth were transport equipment and other manufactures (+18.1 per cent) and food, beverages and tobacco (+10.8 per cent).
To recap, the country’s GDP grew 5.1 per cent in the fourth quarter last year, rising from 5.0 per cent recorded in the preceding quarter. — Bernama
