Monday, November 22, 2010

Sept 2010 Economic Indicators

I’m still waiting on the GDP announcement that’s supposed to be due today, but the economic indicators report from DOS this morning underlines the case that economic growth will be marginal (at least on a q-o-q basis):


Note that all the indices reported have been essentially flat since 1Q 2010 – not exactly a sign of growth. The smoothed growth rates are also been depressingly low:


We’re on no danger of pulling a Singapore though (pdf link: 10.6% y-o-y, –18.7% q-o-q). I’m expecting at worse something along the lines of –3.0% between 2Q 2010 and 3Q 2010, which isn’t too bad under the circumstances, though the tone coming from officials and BNM appear to be more optimistic on 3Q growth.

This does call into question the sustainability of growth going forward though, as external demand continues to remain a huge factor in determining the health of the Malaysian economy. China’s putting on the brakes, and the West is still grappling with debt and employment issues. We’re a long way from the point where domestic demand can fully shoulder the load.

Technical Notes:

September 2010 Malaysia Economic Indicators report from the Department of Statistics

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