KUALA LUMPUR: Malaysia’s second quarter gross domestic product is expected to expand by 8.4 per cent year-on-year (y-o-y), way stronger than the consensus forecast (at 6.9 per cent), driven mainly by the robust external trade performance which improved by 30 per cent y-o-y, AmBank Research said.
The second quarter (Q2 2022) gross domestic product (GDP) growth is also higher than the five per cent recorded in the first quarter this year.
The solid exports of electrical and electronics products that surged strongly by 38 per cent y-o-y (Q1 2022: 27 per cent) and commodity-based products such as petroleum products that leapt 72.9 per cent y-o-y (Q1: 51.5 per cent) and palm-oil based exports, which jumped 49.4 per cent y-o-y (Q1: 67 per cent).
“We are also expecting strong private consumption in Q2 2022 from the pent-up demand, EPF withdrawals, improving job market, higher wages and improving confidence.
“Data has already reflected strong retail sales as the April-May average hit 17.6 per cent year-on-year, compared to January-March’s average of 8.6 per cent year-on-year,” it said in a note today.
The Q2 GDP data is scheduled to be announced by Bank Negara this Friday.
The research arm of AmBank Group noted that despite the wider GDP expansion during the second quarter, it remain on the lookout for certain factors going forward including the rising cost of living that is expected to weigh on consumer spending.
The other factors are the external headwinds of slower global growth and trade, supply chain disruptions and high freight as well as commodity prices.
“The labour shortages are resulting in huge opportunity revenue loss plus shortage of talents and the geopolitical tension in Ukraine and now between China and Taiwan will also be the factors impacting our economy moving forward.
“On the whole, we maintain our view of a 5.6 per cent GDP growth in 2022 with an upside of 6.0 per cent and downside of 4.8 per cent,” it said. – BERNAMA
