Front-Loading Activities To Keep Malaysia's Trade Momentum Strong - RHB

KUALA LUMPUR, Dec 6 (Bernama) – RHB Research Institute Sdn Bhd expects Malaysia’s strong trade momentum to continue in the coming months, as front-loading activities by Chinese importers will likely prevail following the trade ceasefire and ongoing negotiations between the US and China. In a research note, RHB said barring any new announcements between the two countries, it maintained the forecast for gross export growth at a slower four per cent in 2019, from 5.7 per cent estimated for 2018, on account of weaker global trade outlook and slowdown in demand from China. “Export growth surged to a strong 17.7 per cent year-on-year (y-o-y) in October, from 6.5 per cent in September, above the consensus estimate of 5.8 per cent. “It came on front-loading demand from China ahead of the anticipated US tariff hike to 25 per cent from 10 per cent on US$250 billion worth of Chinese exports by Jan 1, 2019,” it said. The research house also noted that higher exports were also buoyed by oil prices that climbed above US$80 per barrel in October, pushing commodity export values higher. Commenting on the current account surplus of the balance of payments, it said the amount was expected to widen for 2019 to RM38.8 billion, or 2.5 per cent of the Gross Domestic Product (GDP) from 2.2 per cent of GDP for 2018, on lower import of goods and services following the deferment of infrastructure projects. – BERNAMA