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Malaysia said its economy returned to expansion at the end of 2021 amid easing pandemic restrictions, while flagging risks for this year from inflation, further virus disruptions and global growth.
Gross domestic product growth in the December quarter rebounded to 3.6% from a year earlier, Malaysia’s central bank said Friday, beating the 3.3% median growth expected in a Bloomberg survey. That pushed full-year GDP up 3.1%, within the official forecast range of 3%-4%.
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Growth is expected to accelerate going forward as Malaysia rolls out vaccine booster shots and prepares to reopen its borders. The country is poised to benefit from stronger global demand and higher private spending in 2022, according to the central bank.
All sectors of the economy showed improvement in the last quarter, Bank Negara Malaysia Governor Nor Shamsiah Mohd Yunus said in a briefing Friday, adding that momentum through this year will be driven by global demand and trade, as well as resumption of domestic activity.
“Going forward, Malaysia’s GDP should be able to record respectable growth, given there are likely to be fewer restrictions on mobility following the indication that international borders would reopen in March,” said Mohd Afzanizam Abdul Rashid, chief economist at Bank Islam Malaysia Bhd. The economy will likely grow 5.5% in 2022, he said, while flagging risks to the forecast from supply chain issues and the prospect of higher borrowing costs.
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Malaysia’s main equity index rose 0.6% to more than a three-month high at the close. The ringgit fell 0.2% to 4.1902 per dollar while 10-year bond yields were up two basis points to 3.72%.
Policy Support
Shamsiah added that cost pressures remain from high commodities prices and supply-chain issues, and that inflation is expected to edge up this year while its core measure will remain “modest.” She cautioned that there would be an impact on the economy from “premature withdrawal” of monetary policy support.
“We will remain vigilant of the latest developments and any new data,” she said. “Any adjustment to the degree of accommodation will depend on how these developments will affect the growth and inflation outlook.”
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Given the nation’s current-account surplus, Bank Negara Malaysia can “still afford to hold out a bit more unlike some of its EM peers” on raising rates, said Wellian Wiranto, an economist at Oversea-Chinese Banking Corp. in Singapore. “We see a rate hike to come only in 3Q, and by a muted 25 basis points this year.”
Risks to Malaysia’s outlook include slower-than-expected global growth and financial market volatility, higher commodity and energy prices and worsening supply-chain disruptions, as well as tighter pandemic restrictions domestically, Shamsiah also said Friday.
The official GDP forecast this year is for 5.5%-6.5% expansion, with the central bank set to announce any revisions on March 30.
Avoiding Lockdown
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Malaysia has said it will avoid a repeat of last year’s lockdowns that pushed GDP into contraction for two quarters. The country’s rising vaccination rate — about 54% of the adult population had received booster shots as of Thursday — has kept hospital admission rates manageable amid the omicron wave.
New Covid cases on Friday topped 20,000 for the first time since early September. Still, only 158 patients were in the ICU compared with more than 1,500 at the peak of the delta wave in August, data from the health ministry show.
That prompted a government advisory council to propose the country reopen its borders by March, potentially boosting consumer spending and benefiting key sectors such as banking and construction. That came days after the Health Ministry said it would recommend such a move only after the booster rate improved.
Compared to the previous three months, the economy last quarter grew 6.6% on a seasonally adjusted basis, compared to a 6.3% median expectation in the Bloomberg survey.
TORONTO – Strength in the base metal and technology sectors helped Canada’s main stock index gain almost 100 points on Friday, while U.S. stock markets also climbed higher.
The S&P/TSX composite index closed up 93.51 points at 23,568.65.
In New York, the Dow Jones industrial average was up 297.01 points at 41,393.78. The S&P 500 index was up 30.26 points at 5,626.02, while the Nasdaq composite was up 114.30 points at 17,683.98.
The Canadian dollar traded for 73.61 cents US compared with 73.58 cents US on Thursday.
The October crude oil contract was down 32 cents at US$68.65 per barrel and the October natural gas contract was down five cents at US$2.31 per mmBTU.
The December gold contract was up US$30.10 at US$2,610.70 an ounce and the December copper contract was up four cents US$4.24 a pound.
This report by The Canadian Press was first published Sept. 13, 2024.
OTTAWA – Statistics Canada says wholesale sales, excluding petroleum, petroleum products, and other hydrocarbons and excluding oilseed and grain, rose 0.4 per cent to $82.7 billion in July.
The increase came as sales in the miscellaneous subsector gained three per cent to reach $10.5 billion in July, helped by strength in the agriculture supplies industry group, which rose 9.2 per cent.
The food, beverage and tobacco subsector added 1.7 per cent to total $15 billion in July.
The personal and household goods subsector fell 2.5 per cent to $12.1 billion.
In volume terms, overall wholesale sales rose 0.5 per cent in July.
Statistics Canada started including oilseed and grain as well as the petroleum and petroleum products subsector as part of wholesale trade last year, but is excluding the data from monthly analysis until there is enough historical data.
This report by The Canadian Press was first published Sept. 13, 2024.
TORONTO – Canada’s main stock index was up more than 150 points in late-morning trading, helped by strength in the base metal and energy sectors, while U.S. stock markets were mixed.
The S&P/TSX composite index was up 172.18 points at 23,383.35.
In New York, the Dow Jones industrial average was down 34.99 points at 40,826.72. The S&P 500 index was up 10.56 points at 5,564.69, while the Nasdaq composite was up 74.84 points at 17,470.37.
The Canadian dollar traded for 73.55 cents US compared with 73.59 cents US on Wednesday.
The October crude oil contract was up $2.00 at US$69.31 per barrel and the October natural gas contract was up five cents at US$2.32 per mmBTU.
The December gold contract was up US$40.00 at US$2,582.40 an ounce and the December copper contract was up six cents at US$4.20 a pound.
This report by The Canadian Press was first published Sept. 12, 2024.
