Malaysia exports slowing, 3Q growth strongest since 2010, says RHB Research

Malaysia exports slowing, 3Q growth strongest since 2010, says RHB Research
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KUALA LUMPUR (Nov 6): RHB Research Institute Sdn Bhd said Malaysia’s exports retained a healthy pace of a 14.8% year-on-year (y-o-y) growth in September, albeit slowing from 21.6% in the previous month amid a waning low-base effect.

In an economic update today, the research house nevertheless said that September’s reading still rounded up 3Q with the strongest quarter in seven years.

“Moving forward, given the fading base-effect, we expect export growth to be sustained at 6.5% in 2018, albeit slowing from an estimated 15.2% this year.

“Overall, the external outlook continues to be supported by:

1.   Improving global growth prospects, moving into 2018;

2.   Strong global E&E demand, as seen in the recovery of global semiconductor sales;

3.   Stable demand for commodity products, holding up export prices,” it said.

RHB Research said it expects the current account surplus to widen slightly to RM30.3 billion or 2.1% of gross domestic product (GDP) in 2018, after narrowing to RM24.7 billion or 1.9% of GDP in 2017.

It said this is contributed by a higher surplus in the trade account.

“Trade balance narrowed in September, as imports grew at a faster pace compared to exports on a month-on-month basis.

“The trade surplus stood at RM69.6 billion in the cumulative Jan-Sep period, improving from a surplus of RM60.2 billion in the corresponding period last year,” it said.