KUALA LUMPUR (May 6): AmBank Research expects Malaysia to register a weaker gross domestic product (GDP) growth of between 3.8 per cent and 4.2 per cent in the first quarter of 2019 (1Q19), against 4.7 per cent recorded in the fourth quarter of 2018.

“With a weak outlook for the 1Q19 GDP data, noises that Bank Negara may cut the 3.25 per cent overnight policy rate (OPR) in the coming May monetary policy committee meeting have gained traction.

“However, we feel the central bank will most likely hold the rate in May and institute a rate cut in July,” the research house said in a note today.

AmBank also said that exports and imports continued to stay in the negative region for the second consecutive month, with exports fell 0.5 per cent year-on-year (y-o-y) in March while imports dropped 0.1 per cent y-o-y, which bring 1Q19 exports down 0.9 per cent y-o-y.

It also said imports contracted 2.8 per cent y-o-y, while March’s trade surplus came in at RM14.4 billion.

“The drag in exports came from the electrical & electronic (E&E) segment but was cushioned by resource-based products,” it added.