The seasonally adjusted S&P Global Malaysia Manufacturing PMI posted 49.9 in June, broadly in line with the neutral 50.0 mark.
MIDF in its report noted that the Malaysia’s S&P Global Manufacturing PMI descended marginally to 49.9 in Jun-24 (May-24: 50.2). New orders rose for the 2-straight months, albeit at a softer pace. Export sales on improving trends for 3-consecutive months, bolstered by increased orders from Asia Pacific. Manufacturers pared production volume slightly following May-24 rise but kept the hiring level steady. In terms of price, cost inflation was stable, but input inflation accelerated.
The house noted that this is possibly due to the diesel-subsidy rationalisation effects. Manufacturers remained optimistic about the sector outlook, with order growth projected to be sustained. Despite the slight deterioration, PMI releases of other regional economies continued to point towards better regional trade conditions, China (51.8), Indonesia (50.7), Philippines (51.3), Taiwan (53.2), and Vietnam (54.7). Henceforth, MIDF said it remains optimistic on Malaysia’s external trade performance in 2HCY24 among others due to better oversea sales of manufactured goods, including E&E, refined petroleum, chemicals, and machinery & equipment.
Additionally, MIDF said it foresees a steady expansion in palm oil and mining exports, supported by encouraging global commodity prices. Consequently, the house has reaffirmed its expectation for goods exports to rebound and grow by +5.2% in 2024 (2023: -8.0%, 5MCY24: +4.5%).
