Malaysian Trade Surplus Posts Year's Record High in Aug

Oct 4, 2007 - Malaysian exports rose 6.1% to 53.61 billion ringgit in August from the previous month, driven mainly by a 10.9% increase in exports of electrical and electronic products, the Statistics department said Thursday. However, on a yearly basis, exports edged up 0.3% in August.

Imports amounted to 44.61 billion ringgit in August, up 4.9% from July and 2.9% from a year ago.

The overall trade value showed increases of 5.6% from the prior month and 1.5% from a year earlier. Trade surplus widened 12.7% monthly to this year's high of 8.99 billion ringgit, marking consecutive monthly increase since November 1997.

In July, Malaysia's trade surplus stood at 8.0 billion ringgit, as total exports and imports were valued at 50.5 billion ringgit and 42.5 billion ringgit respectively.

In the first eight months, exports reached 387.24 billion ringgits, an increase of 2.0% from last year, while imports expanded 3.3% to 326.59 billion ringgit. The cumulative trade surplus amounted to RM60.65 billion during the period.

Electrical and electronic products group was the main driver of growth in exports in August. The value of electrical and electronic products grossed 24.24 billion ringgit during the month, accounting for 45.2% of the total exports.

Palm oil, chemicals and chemical products crude petroleum, liquefied natural gas refined petroleum products, machinery, appliances and parts occupied remaining space with significant contributions.

ASEAN, US, EU, China, Japan, Hong Kong and West Asia were the top export markets, which accounted for 80.4% of Malaysia's total exports in August.

Malaysian M3 Broad Money Increases In August

Sep 28, 2007 - Malaysia's broad money, or M3, grew at an annualized rate of 11.8% percent in August, Bank Negara Malaysia said Friday. In July, M3 increased by 13.4%.

The central bank data showed that the M3 expanded mainly on account of higher claims on the private sector, supported by higher loans extended, as well as the holdings of private debt securities by the banks.

At the same time, narrow money, or M1, increased 17.8% due to higher currency in circulation and placements of demand deposits.

The central bank said in a statement that the gross financing to the private sector remained strong amid robust growth in the banking system loan disbursements in August.

Also, major loan indicators for the business and household sectors continued positive growth through August.

Meanwhile, the net NPL ratio of banking institutions improved further to 3.6% in the month of August.

Malaysian Q2 Current Account Surplus Widens

Sep 28, 2007 - Malaysia's June quarter current account surplus widened to 23.7 billion ringgit from 20.1 billion ringgit in the previous quarter, the department of Statistics said Friday.

The growth was mainly due to higher trade surplus on goods amounting to 29.1 billion ringgit, up from 27.6 billion ringgit in the earlier quarter. Services account was in surplus of 0.9 billion ringgit, compared to deficit of 0.5 billion ringgit in the previous quarter. Income account showed a deficit of 2.5 billion ringgit, improving from the earlier deficit of 3.1 billion ringgit. The net outflow on current transfers remained unchanged at 3.8 billion ringgit in the second quarter.

The department further said that exports expanded 4.6% to 138.6 billion ringgit in the second quarter, while imports climbed 4.4% to 115.9 billion ringgit.

For the first half year, the current account surplus reached 49.4 billion ringgit, sharply up from 24.0 billion ringgit last year. Trade surplus on goods fell 7.4% to 56.7 billion ringgit, from 61.2 billion ringgit over the same period. Services account showed a surplus of 0.3 billion ringgit in the first half year. This compared to a deficit of 5.4 billion ringgit posted last year. Meanwhile, the net outlay on government services improved to 0.1 billion ringgit from an outflow of 0.2 billion ringgit a year ago.

Malaysia confident of 6% GDP growth target

Sep 4, 2007 - Malaysia is confident of reaching its economic growth target of 6 per cent for this year, Second Finance Minister Nor Mohamed Yakcop said on Tuesday.

'We have the flexibility, in the context of any slowdown in the international environment. We have the flexibility to keep the momentum of growth in the economy,' he said.

Some economists have raised doubts about the government's target, citing weaker export demand, but strong domestic demand helped the country post better-than-expected growth in gross domestic product for the second quarter.

Last week, Malaysia reported second-quarter growth of 5.7 per cent from a year earlier.

Exports fall

Malaysian exports fell 0.02 per cent in July from a year ago, their second straight annual drop, on weaker global demand for electronics, official data showed on Tuesday.

Imports, about three-quarters of which are used to make exports, rose 2.5 per cent in July from a year earlier.

The trade surplus narrowed to RM7.98 billion (US$2.28 billion) in July from 9.04 billion ringgit a year earlier.

Malaysian Trade Surplus Narrows On Higher Imports In July

Sep 4, 2007 - The Malaysian trade surplus narrowed on higher imports in July, official data indicated Tuesday.

The trade surplus narrowed to 7.98 billion ringgit in July from 8.78 billion ringgit recorded in June, the Department of Statistics said. The report noted that the trade balance showed surplus for the 117th straight month since November 1997.

Imports climbed 5.3% to 42.54 billion ringgit from June. On an annual basis, imports were up 2.5%. Imports of intermediate goods were valued at 30.47 billion ringgit and capital goods imports amounted to 6.01 billion ringgit.

Exports grew 2.7% from the prior month on account of significant growth in exports of palm oil, liquefied natural gas, crude petroleum and electrical and electronic products. Electrical and electronic products accounted for 43.3% of total exports were valued at 21.85 billion ringgit. Meanwhile, overseas shipments dropped 0.02% annually compared to a 0.1% fall registered in the prior month. Economists were looking for an annual growth of 0.6% in exports. ASEAN, the U.S., the European Union, Japan, the People's Republic of China were the major export markets in July. Exports to ASEAN climbed 2.9%, while exports to the U.S advanced 1.5% from June.

Total trade amounted to 93.06 billion ringgit in July, up 3.9% from the prior month.

During the first seven months of 2007, exports totaled 333.65 billion ringgit and imports amounted to 281.99 billion ringgit, resulting in a trade surplus of 51.66 billion ringgit.

Malaysia's broad money grows 13.4 percent in July vs 12.6 percent in June

Aug 30, 2007 - Malaysia's broad money supply, as measured by M3, grew at an annualized rate of 13.4 percent in July, the central bank said.

In June, M3 expanded by 12.6 percent.

"M3 expanded mainly on account of higher claims on the private sector," Bank Negara said in a statement released late Wednesday.

"Government operations also contributed to the expansion in M3, following larger development expenditure in July coupled with the salary increase for civil servants," the central bank said.

Last month, the government approved wage increases of 7.5-35 percent for the country's one million civil servants.

Narrow money, or M1, rose at an annualized rate of 18.5 percent in July as placements of demand deposits increased. In June, it expanded by 16.2 percent.

(1 US dollar = 3.50 ringgit)

Malaysia Q2 GDP up 5.7 pct vs year earlier on private, public spending

Aug 29, 2007 - Malaysia's gross domestic product grew 5.7 percent on an annualized basis in the second quarter, up from a revised 5.5 percent expansion in the first quarter, boosted by private and public sector spending, central bank governor Zeti Akhtar Aziz said Wednesday.

First-quarter GDP was originally estimated at 5.3 percent.

Economists polled by Thomson Financial were forecasting second-quarter GDP growth of 5.2-5.4 percent.

A strong performance in the services sector and increased activity in the mining and construction sectors were the main drivers of second-quarter growth, said Zeti.

"We are on track to achieve a strong performance of our domestic economy in terms of consumption and investment activities," she told reporters.

The inflow of foreign direct investment has also exceeded expectations, she said.

Malaysian economic growth will still depend on how the US economy performs for the rest of the year but at this stage, the central bank is keeping its full-year forecast for growth of 6 percent, she said.

"Even if external factors have an impact, (full-year GDP growth) will be close to that forecast," Zeti said.

For the first half, the economy grew an annualized 5.6 percent against a six percent rise last year.

The central bank said the services sector, which grew by 9.2 percent in the quarter, remains the key growth driver as it continued to benefit from increased finance and business activity as well as favorable stock market performance.

The mining sector swung from a 0.6 percent contraction in the first quarter to a 7.7 percent growth in the second, supported by higher output of both crude oil and natural gas.

The construction sector grew by another 4.8 percent in the second quarter from a rise of 4 percent in the preceding quarter as new projects under the Ninth Malaysia Plan commenced work.

The Ninth Malaysia Plan is the government's 200 billion-ringgit, five-year development blueprint which runs through 2010.

Despite weakness in the electronics and electrical industry, the manufacturing sector still managed to grow by 1.5 percent, though at a slower pace than the 2 percent growth in the first quarter.

The agriculture sector contracted by 0.9 percent after rising 2.2 percent in the previous quarter mainly due to lower production of crude palm oil as a result of unfavorable weather conditions.

Zeti said she does not expect a change in interest rates in Malaysia as current domestic interest rates are already near historical lows and loan growth has been significant in recent months.

"Therefore, we see interest rates at this stage as still very supportive to economic growth," Zeti said.

She said the unwinding of yen carry-trades has also had little impact to Malaysia given the relatively low lending rates here.

(1 US dollar = 3.50 ringgit)