Malaysia: Export growth picks up pace, but trade surplus narrows on stronger import growth
In June, export growth picked up steam thanks to skyrocketing foreign demand for refined petroleum products and for electrical and electronic products. Palm oil and palm oil-based products exports contracted at a sharper rate in June than in May, however. Overall, exports expanded 15.2% year-on-year in USD value terms, above the previous month’s 13.1% annual increase. In ringgit terms, export growth in June (+7.6% year-on-year) more than doubled May’s print (+3.4% yoy), but came in below more bullish market expectations of 11.5% growth.
Import growth accelerated to 23.0% over the same month a year earlier in USD value terms. The result, which was up from May’s 9.5% print, was driven by a broad-based improvement: All three subcategories rebounded from contractions in May. The biggest expansion was recorded in capital goods imports, which grew at a double-digit pace, followed by consumption goods and intermediate goods. In ringgit terms, imports shifted into a significantly higher gear after a virtual standstill in May, expanding 14.9%.
Due to strong import growth outpacing exports, Malaysia’s trade surplus shrank from USD 2.1 billion in May to USD 1.5 billion in June. This was noticeably below the USD 2.3 billion surplus recorded in June of last year. Subsequently, the 12-month moving sum of the trade surplus narrowed from USD 29.1 billion to USD 28.3 billion.