Malaysia to see slower economic growth in months ahead, says Statistics Dept

A view of the Petronas Twin Towers in Kuala Lumpur April 30, 2019. According to the Department of Statistics, Malaysia is expected to see softer economic growth in the months ahead. — Picture by Choo Choy May
A view of the Petronas Twin Towers in Kuala Lumpur April 30, 2019. According to the Department of Statistics, Malaysia is expected to see softer economic growth in the months ahead. — Picture by Choo Choy May

KUALA LUMPUR, March 30 — Malaysia is expected to see softer economic growth in the months ahead after the Leading Index (LI), which gauges economic direction, showed a slower year-on-year growth of 0.7 per cent in January this year compared to 1.9 per cent in December 2019, said the Department of Statistics Malaysia.

Chief statistician Datuk Seri Mohd Uzir Mahidin said the index for reference month January 2020 had not taken into account the internal shocks that had a direct impact on the economy, notably the Covid-19 pandemic plaguing Malaysia since January 23.

“These pandemic effects are expected to be reflected in the index of subsequent month,” he said in a statement today.

On a month-on-month basis, he said the LI increased 0.1 per cent in January 2020 from a negative 0.3 per cent in the previous month.

“Among seven components of LI, two posted rises, namely expected sales value in manufacturing sector (0.5 per cent) and Bursa Malaysia Industrial Index (0.1 per cent),” he said.

Mohd Uzir said the Coincident Index (CI), which measures the overall current economic performance, was virtually unchanged at 0.2 per cent in January 2020 against December 2019.

He said total employment in the manufacturing sector, which stood at 0.2 per cent, was the main contributor to the increase.

“However, the CI showed a lower annual growth rate of two per cent in January 2020 compared to 2.4 per cent recorded in the previous month,” he said.

Mohd Uzir said the Diffusion Index for LI and CI remained above 50 per cent with a downward trend.

The Diffusion Index for LI and CI stood at 57.1 per cent and 83.3 per cent, respectively, in January this year compared with 71.4 per cent and 100 per cent, respectively, in December last year.

The Malaysian Economic Indicators consisting of Leading, Coincident and Lagging Indexes were rebased to year 2015 from 2005.

“This rebasing was implemented to improve compilation concepts and methodologies in line with international best practices,” Mohd Uzir said. — Bernama

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