Malaysia's economy likely grew 11.7% in Q3, outlook cloudy- Reuters poll | Inquirer Business

Malaysia’s economy likely grew 11.7% in Q3, outlook cloudy- Reuters poll

/ 08:45 AM November 09, 2022

BENGALURU  – Malaysia’s economy grew in double digits for the first time in over a year in the third quarter, boosted by strong domestic consumption and robust exports, according to a Reuters poll, but the outlook ahead was clouded by risks of a global slowdown.

In September, Malaysia posted a trade surplus of $6.7 billion, the largest in over two decades as exports saw strong double-digit growth of 30.1 percent, led by higher shipments of electronics, oil and gas products amid high prices.

ADVERTISEMENT

The Nov. 1-8 poll of 22 economists predicted the economy expanded 11.7 percent in the July-September quarter compared with the same period a year earlier. In the previous quarter, the economic grew 8.9 percent.

“A low statistical base from the third quarter of 2021, when the economy was in lockdown, will contribute towards an elevated year-on-year GDP growth reading for Q3 2022,” said Shivaan Tandon, emerging Asia economist at Capital Economics.

FEATURED STORIES

“The reopening of international borders should help to ease labor shortages in certain sectors and also drive a continued recovery in the tourism sector. However, the boost is likely to be offset by drags from elsewhere, with tighter monetary policy, slower employment and wage growth alongside weaker external demand.”

In its latest budget estimates the Malaysian government upgraded growth forecasts for this year to 6.5 percent-7 percent from 5.3 percent-6.3 percent but expected growth for 2023 to slow to 4 percent-5 percent.

Trade and economic activity was also likely to be affected by China’s strict COVID-19 containment measures and a slowdown in global growth.

A separate Reuters poll showed Malaysia’s growth would average 7.2 percent this year and then fall to 4.2 percent in 2023.

Malaysia’s ringgit has underperformed this year, affecting inflation, despite the central bank steadily hiking interest rates to “preemptively” manage price pressures, albeit in increments of 25 basis points, amid a strengthening U.S. dollar.

“The currency is likely to remain under downward pressure until U.S. bond yields peak and market participants remain risk averse amid elevated levels of global economic uncertainty,” added Tandon.

Subscribe to our business newsletter

By providing an email address. I agree to the Terms of Use and acknowledge that I have read the Privacy Policy.

Read Next
Don't miss out on the latest news and information.

Subscribe to INQUIRER PLUS to get access to The Philippine Daily Inquirer & other 70+ titles, share up to 5 gadgets, listen to the news, download as early as 4am & share articles on social media. Call 896 6000.

TAGS: consumption, economy, Exports, Malaysia
For feedback, complaints, or inquiries, contact us.

Subscribe to our business news

By providing an email address. I agree to the Terms of Use and acknowledge that I have read the Privacy Policy.



© Copyright 1997-2023 INQUIRER.net | All Rights Reserved

We use cookies to ensure you get the best experience on our website. By continuing, you are agreeing to our use of cookies. To find out more, please click this link.