Malaysia's January Factory Output Growth Lags View

Cornelia Mascio
Marzo 14, 2018

Malaysia's Industrial Production Index (IPI) rose 3.0 per cent in January 2018 from the same month of 2017, supported by positive growth in all indices, manufacturing (4.8 per cent), mining (1.5 per cent) and electricity (4.3 per cent).

"The major sub-sectors (in the manufacturing sector) which recorded increases in January 2018 were food, beverage and tobacco products (14.4%), petroleum products, chemicals, rubber and plastic (2.1%), and electrical and electronic equipment products (4%)", the department said. However, the pace of growth was much weaker than the expected 6.8 percent.

Output from the key manufacturing sector increased 4.8% from a year earlier, slowing from December's 5.3% growth.

Economists said the latest data suggests overall economic expansion will likely remain steady, allowing the central bank to stand pat on interest rates for the rest of the year.

Factory output grew 3 percent from a year earlier in January, well below the 7.1 percent annual rise forecast in a Reuters poll.

Meanwhile, the mining sector and electricity output grew 1.5 percent and 4.3 percent respectively.

"Hence, based on solid uptrend in trade activities and further steady domestic consumption, we expect industrial production growth to hit 4.3 percent in 2018", it added.

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