KUALA LUMPUR, Aug 15 — MIDF Research estimated the full quarter gross domestic product (GDP) growth for the second quarter (2Q) to be around 6.1 per cent year-on-year (y-o-y), supported by robust growth in the services sector.
In a note today, MIDF Amanah Investment Bank Bhd said domestic spending stayed robust and domestic demand in Malaysia remains the key driver underpinning stronger growth momentum in 2Q.
MIDF Research said consumer spending continued to increase as shown by the more robust rise in retail trade, which grew 7.4 per cent y-o-y in 2Q compared with 5.2 per cent in 1Q, the fastest expansion in four quarters.
“Other factors that will push GDP growth above 6 per cent growth y-o-y is the encouraging progress in construction works and stronger output in the manufacturing and mining sectors.
“Export recovery also contributed to the 2Q GDP growth, but we do not expect any big boost from net exports in view of more robust growth in imports,” it said.
MIDF Research opined the growth momentum will continue in 2H, backed by stronger domestic economic activity and recovering exports.
“Nevertheless, we are wary of several downside risks to Malaysia’s growth outlook, which could come from possible re-acceleration in inflation and uncertainties from the external front, such as weaker growth in China and the United States and further escalation in geopolitical conflicts,” it added.
— Bernama
