January IPI growth in line with trade performance [New Straits Time (Malaysia)]
(New Straits Time (Malaysia) Via Acquire Media NewsEdge) KUALA LUMPUR: Output from the manufacturing, mining and electricity sectors increased by an annualised 3.7 per cent rate in January.
Although it came in below market expectations, January's industrial production index (IPI) growth was in line with the sustained expansion in trade performance, said econo-mists.
The base year for comparison has been changed to 2010 from 2005 previously.
According to the Statistics Department, the major sub-sectors in manufacturing, which registered an increase in January, were electrical and electronics products (13.3 per cent), petroleum, chemical, rubber and plastic products (6.7 per cent) and transport equipment and other products (4.7 per cent).
Growth in the mining sector was driven by crude oil and natural gas indices.
Alliance Research chief economist Manokaran Mottain said a slower IPI growth in February is a possibility, in line with the shorter working month due to the Chinese New Year holidays.
"A weak first quarter for Malaysia has been an ongoing trend in the past years," he said.
The long-term trend remains intact, as reflected by the robust growth that is in line with the steady expansion in manufacturing activities worldwide, as shown in the JPMorgan Global Manufacturing PMI (Purchasing Managers' Index), he added.
"After the extreme weather conditions that disrupted economic activities in January, the United States economy is recovering steadily as the Institute of Supply Management index in February rebounded to 53.2 from 51.3 previously."
Bank of America Merrill Lynch economist Dr Chua Hak Bin commented that manufacturing output expanded at a healthy rate, despite the earlier Chinese New Year holidays this year.
Exports continued to post strong growth (12.2 per cent year-on- year) in January, led by manufactured goods, while manufacturing sales rose a strong 12.3 per cent year-on-year to RM56.1 billion.
The Statistics Department said manufacturing sales growth was led by five industries - diodes, transistors and similar semiconductor devices (87.4 per cent), electrical capacitors and resistors (56.4 per cent), consumer electronics (36.5 per cent), computers (16.7 per cent) and communication equipment (37 per cent).
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