KUALA LUMPUR: MIDF Amanah Investment Bank Bhd Research (MIDF Research) has forecast Malaysia’s gross domestic product (GDP) to expand at a moderating pace of 4.7 percent year-on-year (y-o-y) for the third quarter of this year compared with 4.9 percent y-o-y growth in the preceding quarter.
In a research note yesterday, MIDF Research said moderation in private consumption in particular, as a result of higher base effect last year following a tax holiday, would contribute to the slower pace.
“Nevertheless, robust net export and increasing government spending would partially cushion the impact,” it said.
Overall, the research firm said Malaysia’s economic activities are predicted to continue expanding amid resilient domestic spending and challenging external trade performances.
“Moving forward, we view continuous expansionary momentum, particularly with solid domestic demand, lower overnight policy rate effects, stable job market, low inflationary pressure and gradual pick-up of commodity prices this year.
“On top of that, the easing monetary policy by major countries may act as a factor to push demand for goods,” it said.
However, the research house noted that trade spat between the US and China remained a downside risk to export-oriented economies, including Malaysia’s.
“The uncertainties over the US-China trade agreement persist as the duo have not signed anything yet,” it said. – Bernama