Malaysia Economic Outlook
November 17, 2020
Following Q2’s record fall in GDP, activity contracted at a much softer pace in Q3 as Covid-19 restrictions were eased in early June. Exports shrank at a milder pace thanks to increased foreign demand, mainly for electronics, while domestic demand contracted less steeply, with consumer and capital spending both falling at a softer rate. Turning to Q4, incoming data suggests that the recovery might be losing steam. The manufacturing PMI slid further into contractionary territory in October, reflecting moderating growth in new orders and output. This, coupled with the reinstatement of targeted lockdowns in October, bodes ill for private activity. Lastly, on 6 November, the government presented its draft 2021 budget of MYR 322.5 billion (about USD 78 billion)—the largest in the country’s history—based on a 6.5%–7.5% GDP growth rate and a lower fiscal deficit of 5.4% of GDP.Malaysia Economic Growth
The economy is seen contracting sharply this year, before bouncing back in 2021 on the back of firming consumer spending, stronger construction activity and rebounding exports, as demand from key trading partners recovers. That said, the uncertain course of the pandemic clouds the outlook. FocusEconomics panelists see the economy growing 6.6% in 2021, which is unchanged from last month’s forecast. In 2022, the panel sees the economy expanding 4.6%.Malaysia Economy Data
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Malaysia Facts
| Value | Change | Date | |
|---|---|---|---|
| Bond Yield | 3.32 | 0.15 % | Dec 31 |
| Exchange Rate | 4.09 | 0.0 % | Jan 01 |
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Malaysia Economic News
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Malaysia: GDP drops at a less pronounced pace in Q3
November 13, 2020
GDP slid 2.7% year-on-year in Q3, falling at a significantly softer pace than Q2’s pandemic-induced plunge of 17.1%, amid the easing of Covid-19-associated restrictions and firming foreign demand.
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Malaysia: Industrial output rises at faster pace in September
November 9, 2020
Industrial output increased 1.0% year-on-year in September, following August’s 0.2% rise.
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Malaysia: Government announces largest budget in history to address Covid-19 impact and spur economic growth
November 6, 2020
On 6 November, Finance Minister Tengku Zafrul Aziz presented the government’s 2021 draft budget.
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Malaysia: Bank Negara Malaysia holds rate again in November
November 3, 2020
At its 3 November meeting, the Monetary Policy Committee of Bank Negara Malaysia (BNM) kept the overnight policy rate at its all-time low of 1.75%.
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Malaysia: Manufacturing PMI moves deeper into contractionary terrain in October
November 2, 2020
The manufacturing Purchasing Managers’ Index (PMI), produced by IHS Markit, dropped to 48.5 in October from 49.0 in September.
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