Muristek
Stats Dept: Economic growth momentum slightly slower due to geopolitical conflict
KUALA LUMPUR, March 25 ― Malaysia’s Leading Index (LI), a predictive tool used to anticipate economic upturns and downturns in an average of four to six months ahead, has indicated that the country’s economic growth momentum will be a little slower due to geopolitical conflict, among others.
The Department of Statistics Malaysia (DOSM) said the LI remained above 100.0 points at 110.1 points in January 2022, with the year-on-year (y-o-y) LI rising by 0.02 per cent, mainly backed by the Number of New Companies Registered.
“The growth outlook is in line with the full reopening of international borders as the country transitions into the endemic phase, alongside the implementation of the new minimum wage of RM1,500, both of which are expected to increase consumption and support domestic demand.
“However, the (Russia-Ukraine) geopolitical conflict and lockdown of China's major cities impose downside risks to the economic prospect if both incidents are prolonged,” said chief statistician, Datuk Seri Mohd Uzir Mahidin in a statement today.
He said that month-on-month (m-o-m), the LI decreased by 1.2 per cent against 0.5 per cent recorded in December 2021, mainly influenced by the decline in Real Imports of Semi-Conductors (-0.6 per cent) and Number of Housing Units Approved (-0.5 per cent).
Meanwhile, the department said the rapid spread of the Covid-19 Omicron variant is not expected to pose a significant effect on gross domestic product growth.
DoSM said the Coincident Index (CI) in January 2022 grew by 5.5 per cent y-o-y to 117.4 points from 111.3 points in January 2021, and was 2.5 per cent higher m-o-m compared to December 2021’s 114.5 points.
The CI’s growth was driven by the rise in Capacity Utilisation in Manufacturing sector (2.7 per cent), Volume Index of Retail Trade (0.2 per cent) and Real Contributions to Employees Provident Fund (0.1 per cent). ― Bernama