Thursday, January 6, 2011

November 2010 External Trade

As if to offset October’s great numbers, November 2010 exports showed a mild drop (log annual and monthly changes):


I’m not inclined to subscribe too much to this seeming slowdown, even if my forecast last month indicated slightly higher exports for November – the numbers are at worse a little below the average for the year, and is counterbalanced by the jump in October exports, not to mention well within the 1 standard deviation band of the forecast. The drop may just be a factor of lag times in orders and shipping, plus an indication of order fulfilment for stocks of goods for the holiday season.

Most of the shortfall came from electrical and electronics products (log annual and monthly changes; seasonally adjusted):


…which suggests the plausibility of the latter story.

Capital goods imports have continued to tick higher, indicating some confidence in future demand (log annual and monthly changes; seasonally adjusted):


As against that, the near term outlook is less positive, as intermediate goods imports – which serve as inputs to industrial production and exports – doesn’t look quite as good (log annual and monthly changes; seasonally adjusted):


Which means that 4Q 2010 growth might not be as rosy as I initially expected.

Next months forecasts:

Seasonally adjusted model


Point forecast:RM51,251m, Range forecast:RM57,638m-44,864

Seasonal difference model


Point forecast:RM54,320m, Range forecast:RM61,956m-46,685m

Technical Notes:

November 2010 External Trade Report from MATRADE.

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