The Malaysian Economic Statistics Review (MESR), revealed latest indicators remained on a positive trajectory with favourable growth rates in domestic production coupled with a plausible external sector.
The MESR Volume 9/2022 which presented the latest economic scenario based on the official macroeconomic statistics released by the Department of Statistics Malaysia on Sept 30, highlighted with the stalling of major economies, global growth continued to moderate in the second quarter of 2022.
Based on the real GDP forecast of 2022 by the International Monetary Fund (IMF) World Economic Outlook in July this year, the economic growth of major trading partners may foresee moderate growth whereby the US economy is expected to grow 2.3 per cent, China (3.3%) and Japan (1.7%).
Meanwhile, Malaysia’s strong economic growth of 8.9 per cent in the second quarter of 2022 reflects the country’s promising future economic outlook toward recovery. The return of the economic and social activities back to normal deems to be one of the factor catalysts to the country’s better economic situation.
Thus, Malaysia’s real GDP is anticipated to grow by 5.1 per cent year-on-year in 2022. In the first half of 2022, the Malaysian economy grew by 6.9 per cent exceeding the real GDP forecasted by IMF.
Several of Malaysia’s key economic indicators highlighted a favourable economic situation which is further strengthened and supported by the implementation of various initiatives toward economic stability.
In July 2022, the Industrial Production Index (IPI) soared 12.5 per cent as compared to the same month of the previous year. The rise in the IPI was supported by the increment in the Manufacturing index (14.9%), Electricity index (13.2%) and Mining index (3.2%).
Meanwhile, the Manufacturing sector recorded a sales value of RM148.4 billion, an increase of 23.8 per cent (June 2022: 23.4%) as against the same month in 2021. The sales performance was propelled by Electrical & electronics products (26.1%), Petroleum, chemical, rubber & plastic products (19.1%) and Non-metallic mineral products, basic metal & fabricated metal products (44.2%).
Similarly, Malaysia’s Wholesale & retail trade sales recorded a 41.0 per cent year-on-year growth, or RM130.7 billion. The increase in July was contributed by the Retail trade sub-sector which rose 37.5 per cent (+RM15.4 billion) to record RM56.6 billion. Motor vehicles and Wholesale trade grew by 613.8 per cent (+RM12.4 billion, RM14.4 billion) and 20.6 per cent (+RM10.2 billion, RM59.7 billion), respectively.
For a month-on-month comparison, the sales value of Wholesale & retail trade fell 1.6 per cent attributed to the Motor vehicle subsectors (-10.5%) and Wholesale trade (-1.4%).
The labour situation in July was further improved following the normalisation of all economic activities with the corresponding increase in employment and the improvement in unemployment.
These factors have positively impacted the labour market, increasing the need for labour and offering more employment opportunities. The number of employed persons increased by 683.6 thousand persons (+4.5%) as compared with the preceding year to record 15.98 million persons in July 2022. The employment-to-population ratio was recorded at 67.0 per cent and the unemployment rate was 3.7 per cent.
From the perspective of prices, the country’s inflation rate in August 2022 rose 4.7 per cent to 128.2 as against 122.5 in the same month of the preceding year.
The Food index which increased by 7.2 per cent remained the main contributor to the rise in inflation in August 2022. Besides Food, all other groups also continued to record increases except for Communication which remained unchanged as compared to the same month of the previous year.
Accompanying this, Malaysia’s Producer Price Index which measures the prices of goods at factory gates, eased to record 6.8 per cent in August 2022 as compared to 7.6 per cent recorded in July 2022.
The increase was contributed by the Manufacturing index with 9.4 per cent (July 2022: 9.9%), supported by increases in indices of Manufacture of refined petroleum products (21.8%), Manufacture of oils & fats from vegetables & animals (13.8%) and Manufacture of basic chemicals, fertilizers & nitrogenous compounds, plastics & synthetic rubber in primary form (9.2%) and Manufacture of computer, electronic and optical products (6.6%).
