Malaysia: AmBank Group expects Q3 2022 GDO at 12.2% supported by healthy production activity

KUALA LUMPUR: AmBank Group anticipates the third quarter (Q3) 2022 Gross Domestic Product (GDP) numbers to be at 12.2 per cent, better than the Q2 2022 growth of 8.9 per cent.

In its research note, the group said it is maintaining its full-year GDP forecast at 7.5 per cent (base-case), with an upside of 8.5 per cent, backed by the latest industrial production (IP) numbers which continued to grow by double digits, plus strong exports and private consumption.

“For October, we may see softer manufacturing activities, taking the cue from the deeper contractions in the recent manufacturing Purchasing Managers’ Index (PMI) and higher base effects,” said group chief economist/head of research Dr Anthony Dass.

He noted the headline reading fell to 48.7 in October from 49.1 in the previous month due to a slump in global market conditions and muted customer demand.

Looking at the sub-segments within the manufacturing sector, he said the production of transport equipment and other manufactures grew by 21.6 per cent year-on-year (y-o-y) versus 55.2 per cent y-o-y in August 2022, while wood, furniture, paper products and printing grew by 8.7 per cent y-o-y (August 2022: 16.6 per cent y-o-y).

Electrical & electronics (E&E) continued its growth at double-digit by 15.5 per cent y-o-y (August 2022: 19.6 per cent y-o-y).

He said looking at a month-on-month basis, the production of this commodity increased by 2.4 per cent, a slower pace relative to the previous month’s growth of 6.0 per cent.

“However, global semiconductor purchases have contracted since July this year, reflecting the end of the tech cycle.

“Still, we expect global semiconductor sales to grow by 14.0 per cent in 2022, and 5.0 per cent in 2023,” he said.

Malaysia’s IP in September expanded by 10.8 per cent y-o-y, which was at a slower pace relative to the previous month’s 13.5 per cent y-o-y.

This brings the year-to-date growth for IP to 7.9 per cent compared with 8.8 per cent in 2021. – Bernama