Malaysia: Malaysia's external sector continues to perform well at the start of the second quarter
June 5, 2018
The external sector performed well at the start of the second quarter, with year-on-year growth in exports jumping from 16.1% in March to 29.7% in April. The upturn was chiefly driven by a jump in overseas demand for electrical and electronic products, while demand for crude petroleum also increased sharply. Palm oil and palm oil-based exports grew marginally, contrasting the contraction in the prior month. In ringgit terms, export growth accelerated from 2.2% year-on-year in March to 14.0% in April, easily beating market expectations of a significantly more tepid pick-up in pace.
Following suit, imports also expanded at a stellar pace. Imports grew 24.1% over the previous year in April, up from the prior month’s 2.6% figure. This was mainly due to an increase in capital goods imports, as consumption and intermediate goods imports contracted. Capital goods imports rose mainly thanks to greater demand from the transport equipment sector. In ringgit terms, imports rebounded from the prior month’s 9.6% contraction to increase 9.1% over the previous year.
Malaysia’s trade balance registered a surplus of USD 3.4 billion in April, down from the prior month’s surplus of USD 3.7 billion. However, the trade balance was up from the USD 2.0 billion surplus recorded in the same month a year ago. The 12-month moving sum of the trade surplus, moreover, increased from USD 27.0 billion in March to USD 28.4 billion in April, the highest level since July 2014.
Author: Jan Lammersen, Economist