Economic Update
Local
3Q24 Malaysia Gross Domestic Product: Economic Growth Staying Resilient
Mon, 18-Nov-2024 06:53 am
by Kenneth Leong • Apex Research

Executive Summary

  • Malaysia’s 3Q24 GDP growth held steady at +5.3% yoy (2Q24 at +5.9 yoy), and was in-line with advanced estimate of +5.3% yoy. Growth was driven by (i) strong expansion in overall investment activities, (ii) firmer exports and increase in tourism spending and (iii) resilient household spending.

 

  • For 9M24, the economy expanded +5.2% (9M23 at +3.8% yoy), which largely on track to meet the Government projection of +4.8%-5.3% for 2024 tabled under Budget 2025 as well as our internal projection of +5.2% yoy.

 

  • We expect Malaysia’s Real GDP growth to hold steady in the final quarter, bringing 2024 growth at +5.2% yoy vs. +3.6% yoy in 2023, backed by (i) stability of labour market conditions to be supportive towards domestic consumption, (ii) execution of multi-year projects from approved investments, (iii) stronger trade activities and (iv) implementation of new economic reformation policies such. Meanwhile, 2025 GDP growth is projected at +4.6% yoy (unchanged), pending further details on the shift in US trade policies and tariffs.

 

  • Headline and core inflation is projected at +2.1% yoy and +2.0% yoy in 2024, in line with BNM’s projection of 2.0%-3.5% and 2.0%-3.0% respectively, impacted by the implementation of the diesel subsidy rationalisation and hike of the SST to 8.0%, while 2025F headline and core inflation is forecasted higher at +2.6% yoy and +2.4% yoy, in anticipation of the implementation of RON95 targeted subsidy rationalisation in 2H25.

 

  • With expectations that BNM will maintain OPR at 3.0% towards end-2025, we raised our 2024 and 2025 year-end projection for USD/MYR is between 4.40-4.50 (previously at 4.20-4.30) and 4.30-4.40 (previously at 4.10-4.20) respectively, to account for the intensified trade conflict and a more gradual interest rate cut approach from the US Federal Reserve (three cuts in 2025).

Sentiment: Positive
Read more details in:

Disclaimer

The report is for internal and private circulation only and shall not be reproduced either in part or otherwise without the prior written consent of Apex Securities Berhad. The opinions and information contained herein are based on available data believed to be reliable. It is not to be construed as an offer, invitation or solicitation to buy or sell the securities covered by this report.

Opinions, estimates and projections in this report constitute the current judgment of the author. They do not necessarily reflect the opinion of Apex Securities Berhad and are subject to change without notice. Apex Securities Berhad has no obligation to update, modify or amend this report or to otherwise notify a reader thereof in the event that any matter stated herein, or any opinion, projection, forecast or estimate set forth herein, changes or subsequently becomes inaccurate.

Apex Securities Berhad does not warrant the accuracy of anything stated herein in any manner whatsoever and no reliance upon such statement by anyone shall give rise to any claim whatsoever against Apex Securities Berhad. Apex Securities Berhad may from time to time have an interest in the company mentioned by this report. This report may not be reproduced, copied or circulated without the prior written approval of Apex Securities Berhad.

Market Mover
Settlement Rates
Currency Buy Rates (RM) Sell Rates (RM)
USD 4.455268 4.488135
EUR 4.716585 4.723137
CNY 0.616518 0.616862
HKD 0.572409 0.576643
SGD 3.318330 3.343262