KUALA LUMPUR – MIDF Research maintained its growth forecast for Malaysia’s industrial production index (IPI) at 6% for 2022, after the country’s IPI growth softened to 4.6% year-on-year in October 2022, the slowest growth since May 2022.
MIDF also said that based on the latest purchasing managers’ index (PMI) survey, Malaysia’s manufacturing sector activities weakened further in November 2022 due to the PMI falling to 47.9 (October 2022: 48.7) as manufacturers indicated weaker orders and slower output growth.
“Due to concerns over slowing external demand, we keep a cautiously optimistic view on the near-term production outlook.
“In addition, there is still concern over possible recession risks, especially in advanced economies, as demand conditions are expected to soften going into next year due to aggressive policy tightening by major central banks,” the research house said in a note today.
It also noted that as of October 2022, IPI growth has been averaging 7.5% for the first 10 months of this year.
“In view of slowing exports and production in regional countries and signs of weaker demand from major trading partners, we opine IPI growth will continue moderating in the near term.
“In contrast, we expect growing domestic demand will continue to support production in domestic-oriented sectors,” it added. – Bernama, December 12, 2022
