KUALA LUMPUR (July 10): Business confidence in Malaysia has remained marginally optimistic for Q3 2017, according to Dun & Bradstreet (D&B) Malaysia’s Business Optimism Index (BOI).

D&B Malaysia conducts latest Business Expectations Surveys every quarter.

Each quarter, 200 business owners and senior executives representing major industry sectors across Malaysia are asked if they expect increases, decreases or no changes in their upcoming quarterly Sales, Profits, Employment, New Orders, Inventories and Selling Prices.

In a statement today, D&B said that overall BOI inched slightly from +3.07 percentage points in Q2 2017 to +3.40 percentage points in Q3 2017.

It said that on a year-on-year (y-o-y) basis, BOI eased from +4.42 percentage points in Q3 2016 to +3.40 percentage points in Q3 2017.

The six business indicators under the quarterly BOI study include volume of sales, net profits, selling price, inventory level, employees and new orders.

This is the 18th D&B BOI study being released in Malaysia.

Three sectors have emerged as the most optimistic with five indicators each in the positive region.

According to D&B Malaysia, the services, transportation and agricultural sectors were most upbeat for Q3 2017.

For services, despite the optimistic outlook for the services sector, 4 of six indicators have moderated downwards.

For transportation, the outlook for the transportation sector has also eased off slightly with 5 indicators moderating downwards.

As for agriculture, 2 of six indicators have moderated downwards for the agricultural sector in Q3 2017.

For construction, the construction sector has emerged as the least optimistic sector with only 1 indicator in the positive zone in Q3 2017.

As for Mining, 3 indicators are expected to be contractionary for Q3 2017.

Dun & Bradstreet (Malaysia) Sdn Bhd chief executive officer Audrey Chia said the continued optimism displayed by Malaysian businesses in Q3 2017, particularly in the services sector was largely due to the spurt in private investment growth, firmer private consumption and higher government spending, which in turn have fueled domestic demand.

She said credit growth has remained buoyant with manufacturing and transportation sectors recording the fastest growth.

However, Chia said some measure of fiscal restraint will weigh on the Malaysian economy in the coming quarters as the government strives to keep its budget deficit target to 3% of GDP for FY2017.“

“The recent downward moderation of commodity prices has also posed downside risks to the growth outlook given that Malaysia is a large net oil exporter and producer of other commodities.

“Hence, we anticipate sentiments within the mining sector to remain muted,” said Chia.