The broad-based growth in IPI, led by a surge in electricity, manufacturing and mining output, beat market expectations for a 5.5% y-o-y increase. “We also note that domestic-oriented manufacturing IPI growth, as estimated by Bank Negara, has been a drag on overall IPI growth in recent months, underperforming export-oriented manufacturing IPI,” it added. Higher output in the electricity sector reflected increase in economic activities, while output growth in the mining sector was supported by an increase in the natural gas index by 13.2%, which offset the decline in crude oil index by 1.9% during the period. Output growth in the manufacturing sector, on the other hand, was supported by increase in electrical and electronic products (8.9%); petroleum, chemical, rubber and plastic products (6.1%); and food, beverages and tobacco (10.4%). It maintained its projection of a slower GDP growth for Malaysia at 3.7% in 2017 – below the official 4% to 5% forecast.

Source: The Star January 11, 2017 23:13 UTC