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BusinessToday
5 days ago
- Business
- BusinessToday
Maybank Estimates April GDP Lower At 4.8%, Reflects Recent IPI Data
Malaysia's economic growth moderated in April 2025, with Maybank Research estimating gross domestic product (GDP) expansion at 4.8% year-on-year, down from 6.0% in March and 6.2% in April last year. The slowdown reflects a mixed bag of industrial and trade performance, with strength in manufacturing and exports partially offset by weaker mining output and softer consumer demand. The moderation was largely driven by a weaker Industrial Production Index (IPI), which grew 2.7% year-on-year in April compared to 3.2% in March. While manufacturing activity picked up to 5.6% (Mar: +4.0%), sharp declines in mining (-6.3%) and continued contraction in electricity output (-1.6%) weighed on overall industrial growth. Manufacturing gains were powered by stronger output in both export-oriented and domestic industries. Export-oriented production rose 6.4% (Mar: +4.8%), with notable growth in: Electronics & Electricals: +9.9% (Mar: +13.2%) Vegetable & Animal Oils & Fats: +22.8% (Mar: +10.6%) Chemicals & Chemical Products: +4.7% (Mar: +4.9%) Domestic-oriented manufacturing also saw steady expansion at 3.9% (Mar: +2.3%), supported by increased production of food processing products, fabricated metal goods, basic metals, and non-metallic mineral products. The drag from the mining sector was significant, reflecting lower production of crude oil and condensates (-0.7%) as well as natural gas (-10.0%). Electricity output declined for the second straight month. However, crude palm oil (CPO) production rebounded sharply (+12.3%) after a brief contraction in March. Domestic trade activity lost some momentum, with the Distributive Trade Index rising 4.3% in April (Mar: +5.0%). Retail trade growth slowed to 3.4% (Mar: +4.9%), while motor vehicle sales remained tepid at 0.8%. Wholesale trade, however, posted a slight improvement at 6.6% (Mar: +6.3%). Malaysia's external trade saw strong recovery in April, with export values surging 16.4% year-on-year and volumes up 15.6%. Imports also jumped by 20.0% in value and 24.5% in volume, following contractions in March. Despite this rebound, the downtrend in intermediate goods imports raises caution about future manufacturing momentum. Private Consumption Holds Steady Private consumption remained resilient in the first four months of the year, with retail trade growing 4.7% year-on-year—slightly ahead of 2024's pace of 4.4%. Maybank maintains its full-year forecast for private consumption growth at 5.3%, supported by a healthy job market and various government initiatives, including: Civil service pay and pension reviews Minimum wage hikes Increased cash assistance under Budget 2025 Income tax reliefs for the middle-income group The investment upcycle appears to be continuing, with strong capital goods imports and steady financing for industrial construction indicating sustained business confidence. However, Maybank cautioned that the trajectory could face headwinds if the weakness in intermediate goods imports persists. While April's data showed mixed signals, Maybank notes that Malaysia's economy continues to find support from domestic demand and export recovery. However, with certain leading indicators pointing to a possible softening ahead, the growth trajectory for the remainder of the year remains subject to downside risks. Related
New Straits Times
12-06-2025
- Business
- New Straits Times
Malaysia's IPI growth in April reflects strong demand, industrial vitality
KUALA LUMPUR: Malaysia's Industrial Production Index (IPI) growth in April 2025, driven primarily by a robust manufacturing sector, reflects strong aggregate demand and industrial vitality, an economist said. Juwai IQI global chief economist Shan Saeed noted that the government appears committed to maintaining macroeconomic growth stability. "The uptick in domestically oriented manufacturing signals a strategic pivot toward internal economic resilience, underpinned by proactive government measures. "These measures include demand-side stimulus, incentives for small and medium enterprises, and infrastructure investments – all of which reinforce domestic investor confidence and enhance productive capacity," he told Bernama. According to the Department of Statistics Malaysia (DOSM), Malaysia's IPI rose 2.7 per cent year-on-year in April 2025, supported by a 5.6 per cent growth in the manufacturing sector. The department stated that export-oriented industries in the manufacturing sector in April 2025 grew by 6.4 per cent compared with a 4.8 per cent growth in March 2025, while domestic-oriented industries expanded by 3.9 per cent in April 2025 versus 2.3 per cent in March 2025. DOSM also reported that the mining and electricity sectors declined by 6.3 per cent and 1.6 per cent, respectively, in April 2025. Echoing Shan, International Islamic University Malaysia (IIUM) associate professor of economics Dr Muhammad Irwan Ariffin, said the country's IPI growth in April 2025 is a positive sign for the economy, despite declines in the mining and electricity sectors. "While the overall outlook remains cautiously optimistic, we must remain mindful of certain risks and challenges. The declines in the mining and electricity sectors, especially amid global trade uncertainties, could dampen growth in the coming months," he said. Additionally, he highlighted challenges such as slower domestic consumption and potential global trade disruptions, which have led some international institutions to revise their growth forecasts for both Malaysia and the global economy. "That said, Malaysia's favourable manufacturing performance and steady investment inflows indicate strong underlying fundamentals. If global demand remains resilient, the economy is well-positioned to navigate these challenges. "It's important to closely monitor both domestic and external factors as they continue to shape the demand outlook for the rest of the year," he said. Looking ahead, he expects both export-oriented and domestic-oriented manufacturing sectors to play a central role in driving positive industrial performance in the upcoming May 2025 IPI report. "These sectors have shown resilience despite global and domestic challenges, and their continued growth is expected to significantly influence Malaysia's overall industrial output," he said. On a global scale, Muhammad Irwan noted Malaysia's industrial growth has been relatively modest compared to regional competitors such as Vietnam and Taiwan, emphasising valuable lessons to be learned from these countries, such as improving industrial infrastructure and fostering stronger industry-academia partnerships. Meanwhile, Bank Muamalat Malaysia Bhd chief economist Dr Mohd Afzanizam Abdul Rashid attributed the stronger export-oriented industries in the manufacturing sector in April 2025 to front-loading activity by trading partners, particularly from the US – ahead of the anticipated tariff hikes in the second half of 2025 (2H 2025). "This suggests a more challenging outlook for 2H 2025, as traders and investors remain cautious about tariffs and their potential impact on the economy," he said.
The Sun
11-06-2025
- Business
- The Sun
Malaysia's IPI to grow moderately at 2.0% in 2025
KUALA LUMPUR: Malaysia's Industrial Production Index (IPI), which expanded at a slower pace of 2.7 per cent year-on-year (y-o-y) in April, is expected to grow moderately at 2.0 per cent in 2025, according to MIDF Amanah Investment Bank Bhd. The investment bank said it is maintaining its forecast for the IPI to moderate to 2.0 per cent after the Department of Statistics Malaysia (DOSM) announced today that the index rose by 2.4 per cent y-o-y in the first four months of this year (Jan-April 2024: 3.6 per cent). According to DOSM, the IPI recorded a growth of 3.8 per cent in 2024. 'Following continued uncertainties from higher tariffs and intensified trade tensions, production of export-oriented products, particularly manufactured goods, will be adversely impacted by weaker external demand and slower global manufacturing activities. 'Nevertheless, the frontloading and a temporary boost to trade activities could still support these vulnerable sectors which are exposed to the external slowdown,' MIDF Amanah said in a note. It said that although there could be short-term support following the United States' decision to pause the implementation of reciprocal tariffs, encouraging progress from the ongoing trade talks will be crucial to reduce the adverse impacts of trade tensions on future demand outlook and production activities. 'Nevertheless, we maintain positive growth (forecast) for the IPI for now as we expect production, especially in the domestic-oriented sectors, to continue growing on the back of expanding domestic demand,' it added.
The Sun
11-06-2025
- Business
- The Sun
Malaysia's IPI forecast to grow 2.0% in 2025: MIDF Amanah
KUALA LUMPUR: Malaysia's Industrial Production Index (IPI), which expanded at a slower pace of 2.7 per cent year-on-year (y-o-y) in April, is expected to grow moderately at 2.0 per cent in 2025, according to MIDF Amanah Investment Bank Bhd. The investment bank said it is maintaining its forecast for the IPI to moderate to 2.0 per cent after the Department of Statistics Malaysia (DOSM) announced today that the index rose by 2.4 per cent y-o-y in the first four months of this year (Jan-April 2024: 3.6 per cent). According to DOSM, the IPI recorded a growth of 3.8 per cent in 2024. 'Following continued uncertainties from higher tariffs and intensified trade tensions, production of export-oriented products, particularly manufactured goods, will be adversely impacted by weaker external demand and slower global manufacturing activities. 'Nevertheless, the frontloading and a temporary boost to trade activities could still support these vulnerable sectors which are exposed to the external slowdown,' MIDF Amanah said in a note. It said that although there could be short-term support following the United States' decision to pause the implementation of reciprocal tariffs, encouraging progress from the ongoing trade talks will be crucial to reduce the adverse impacts of trade tensions on future demand outlook and production activities. 'Nevertheless, we maintain positive growth (forecast) for the IPI for now as we expect production, especially in the domestic-oriented sectors, to continue growing on the back of expanding domestic demand,' it added.
The Star
11-06-2025
- Business
- The Star
Ringgit rebounds as US dollar weakens despite optimism over trade talk
KUALA LUMPUR: The ringgit strengthened against the US dollar as the greenback softened, with the US Dollar Index (DXY) slipping 0.1 per cent to 99.0 points, despite renewed optimism over a potential breakthrough in the United States (US) -China trade talks. At 6 pm, the local currency stood at 4.2345/2370 against the dollar, slightly firmer than yesterday's close of 4.2360/2420. Bank Muamalat Malaysia Bhd chief economist Dr Mohd Afzanizam Abdul Rashid said that the local currency continues to trade range-bound, moving between 4.2322 and 4.2418. "The renewed optimism over the trade talks failed to sustain due to the lack of information, giving rise to uncertainties yet again,' he told Bernama. Meanwhile, Mohd Afzanizam noted that Malaysia's Industrial Production Index (IPI) grew moderately at 2.7 per cent in April, while growth in the export-oriented industries in the manufacturing sector continues to accelerate to 6.4 per cent, especially the electrical and electronics sector. Front-loading activities among the trading partners, especially from the US, could explain such high growth in the manufacturing activities. "All in all, traders and investors remain cautious on the tariff front and how it may impact the economy,' he added. At the close, the ringgit traded mostly lower against a basket of major currencies. It rose against the Japanese yen to 2.9187/9207 from Tuesday's 2.9270/9314 but weakened versus the British pound to 5.7166/7200 from 5.7152/7233 yesterday and fell vis-à-vis the euro to 4.8426/8454 from 4.8354/8422 previously. At the same time, the local currency traded mixed against its ASEAN peers, rising versus the Singapore dollar to 3.2925/2947 from 3.2932/2981 at yesterday's close and increased vis-à-vis the Philippine peso to 7.57/7.59 from 7.58/7.60 on Tuesday. However, the ringgit declined against the Thai baht to 12.9729/9870 from 12.9712/9955 yesterday and eased against the Indonesian rupiah to 260.4/260.6 from 260.2/260.7 previously. - Bernama
