Monday, February 10, 2014

Malaysia Output Growth Beats Expectations

Malaysia’s December industrial production is due Monday. Headline production is expected to expand by 6.4% on-year, up from 4.3% the previous month. This would be consistent with the better-than-expected exports reported last week.

Exports surged 14.4% on-year in December against consensus expectation of 10%. The main lift came from demand from China, which was up by 37.1%. Exports to Hong Kong and Singapore also rose 30.6% and 20.5%, respectively. And as we’ve pointed out before, about 84% of the recent growth in exports is driven by demand from Asia.

With the improvement in regional demand driving up export performance, industrial production is likely to stay buoyant in the near term. Overall industrial production is expected to remain healthy in the coming months despite a possible dip in production during the festive season in January.