Malaysia’s October industrial production up 2.7%, exceeds forecast
Tan Ai Leng
MALAYSIA’S industrial production rebounded in October, recording a year-on-year growth of 2.7 per cent, spearheaded by the robust performance of the mining sector, the Department of Statistics Malaysia (DOSM) said on Monday (Dec 11).
The latest factory output data also exceeded the forecast of 2.4 per cent by 11 economists in a recent Reuters poll.
The growth reverses September’s decline of 0.5 per cent, and it is the highest since May 2023.
Economists are upbeat about the rebounding industrial production and expect the growth momentum to accelerate till next year as trade activities and external demand improve.
RHB Research economist Chin Yee Sian and associate research analyst Wong Xian Yong observed that there are signs of bottoming out for exports and import data with higher outbound shipments to major destinations, including China.
Improved global economic landscape, accelerating global tech cycle and stronger domestic economic activities are the three key determinants that fuelled an optimistic view, they said in a report on Monday.
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“We have seen higher electronics and electrical exports for Malaysia and regional Asean economies in recent months boosted by robust demand for semiconductor and consumer electrical and electronics products,” they added.
MIDF Research expects China’s economy to continue recovering, following the recovery in the global manufacturing activity and the Chinese government’s measures in revitalising domestic spending.
“With the stronger growth in industrial production and retail trade, we expect Malaysia’s recovery will continue going into the final quarter of 2023 and heading into 2024,” said MIDF in a report.
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Output from the mining sector surged 8.7 per cent year on year in October, as compared with a year-on-year decline of 5.2 per cent in September. The growth was driven by the increased production of crude oil and gas sector, which registered a growth of 10.2 per cent.
The electricity sector saw a growth of 5.8 per cent year on year in October, as compared with a 2.5 per cent year-on-year growth in September.
The manufacturing sector increased by 0.9 per cent, supported by the production of food, beverages and tobacco, as well as non-metallic mineral products, basic metal and fabricated metal products.
The increase in the manufacturing sector was underpinned by the expansion in the domestic-oriented industries, which saw a year-on-year growth of 6.7 per cent in October.
The export-oriented industries declined 1.5 per cent in October, following lesser output of computer and electronics goods as well as coke and refined petroleum products.
Overall, Malaysia’s industrial production expanded 1 per cent year on year from January to October this year.
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