HSBC RESEARCH SEES HEALTHY GROWTH OF ABOVE 5 PCT FOR MALAYSIA

KUALA LUMPUR, Aug 18 (Bernama) -- HSBC Global Research foresees Malaysia
posting a healthy growth of above five per cent this year, although its 5.7 per
cent year-on-year forecast for growth is looking increasingly untenable.

It said the considerable momentum exhibited by the country's private sector
helped to ease the concern about the external slowdown to some extent.

"There is also expectation that a number of infrastructure projects will
pick up pace more markedly over the period," its Asian economist, Wellian
Wiranto, said in the research note Thursday.

Wednesday, Bank Negara Malaysia (BNM), Malaysia's central bank said the
country's economy grew by four per cent in the second quarter this year,
compared to the upwardly revised 4.9 per cent growth in the first quarter.

On the second quarter results, Wiranto said: "The relatively muted growth
pace in second quarter can be attributed to some extent to the supply chain
disruptions that roiled the region."

Even if buffered by the country's commodities, exports did not perform
gloriously as evidenced by the 2.1 per cent year-on-year growth of the
manufacturing sector in second quarter compared to the 5.5 per cent clocked
in the first quarter, he said.

"The domestic part of the economy, in contrast, stood up better. Private
consumption, for instance, grew by 6.4 per cent year-on-year compared to 6.7 per
cent of first quarter."

As for interest rates, he said although HSBC Global Research opined that the
central bank was not quite done with hikes yet, BNM was likely to remain in a
pensive mode and might choose to still hold its rates on the Sept 8 Monetary
Policy Meeting.

On July 9, the central bank raised the Statutory Reserve Requirement (SRR)
ratio to four per cent from three and maintained the Overnight Policy Rate (OPR)
at 3.0 per cent.
-- BERNAMA