Global Tech Upcycle, Front-loading Activities To Support Malaysia's Trade Performance In 4Q 2024

KUALA LUMPUR, Nov 20 (Bernama) -- The global tech upcycle and front-loading activities will likely support Malaysia's trade performance in the fourth quarter of 2024 (4Q 2024), said CIMB Securities Sdn Bhd.

The research house noted that Malaysia’s exports recovered to grow 1.6 per cent year-on-year (y-o-y) in October 2024, although it fell short of market expectations as trade activities softened towards the end of the year. 

Similarly, import growth moderated further to 2.6 per cent y-o-y as capital goods imports slipped 2.7 per cent while intermediate goods imports grew at a slower pace. 

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It noted that as monthly imports outpaced exports, Malaysia’s trade surplus narrowed by 6.2 per cent month-on-month to RM12 billion in October 2024. 

"In light of recent weaker-than-anticipated external trade activity, we have revised our 2024 trade forecasts lower (exports: 5.0 per cent versus 8.0 per cent previously; imports: 12.8 per cent versus 18.0 per cent previously)," it said in a note today. 

Nonetheless, CIMB Securities has maintained its 2024 gross domestic product (GDP) forecast of 5.2 per cent as investment activities remain robust.

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"Looking ahead, we expect exports and imports to expand by 5.3 per cent and 5.6 per cent, respectively, in 2025, in line with our 2025 GDP growth forecast of 5.0 per cent," it said. 

However, it noted that downside risks persist, including potential disruptions to global trade due to policy uncertainties post-United States election, which may heighten inflationary pressure and dampen global trade demand.

--BERNAMA