KUALA LUMPUR – Malaysia is on track to achieve its 2015growth forecast of 4.5
per cent to 5.5 per cent, on the back of resilient Gross Domestic Product (GDP)
growth, says Standard Chartered Research.
“We maintain our full-year forecast of 5.0 per cent and expect GDP growth to
ease to 4.7 per cent year-over-year (y-o-y) in the second half from 5.3 per cent
in the first half as the economy faces headwinds,” it said.
However, the research house said, consumer sentiment is weak — the consumer
sentiment index fell 28 per cent y-o-y in Q2-2015, likely affected by the Good
and Services Tax (GST) implementation in April.
“Spending was more resilient than expected, however the post-GST pullback
that we had expected proved to be shallower than feared,” it said.
Private consumption growth slowed slightly to 6.4 per cent y-o-y in Q2.
“We expect a further moderation, but stable labour market conditions should
limit its extent,” said Standard Chartered.
Investment was weak in Q2, rising only 0.5 per cent y-o-y. Public investment
was the biggest drag.
“We expect public investment to pick up in the second half, as this yearâ€™s
budget allocation to strengthen the economy is about 25 per cent higher than
what was realised in 2014,” said the research house. – BERNAMA