KUALA LUMPUR, March 13 (Xinhua) -- Economists have foreseen Malaysia's industrial production index (IPI) to improve amid brighter manufacturing outlook, after the index rebounded 4.3 percent year on year in January.
RHB Investment Bank said in a note that it maintained its optimistic view for Malaysia's manufacturing sector on the foundation of a brighter trade outlook.
The research house is bullish on the prospect of export-oriented industries such as electrical and electronics, petroleum and petroleum-based products, as well as metal goods production amid stronger external demand.
It also said the export market in Malaysia is expected to benefit from a positive spillover effect amid improved trade performance and manufacturing activities in China.
Robust domestic consumption and investment activities in 2024 are also anticipated to support the manufacturing sector, said RHB.
Meanwhile, Kenanga Research retains the manufacturing index forecast at 4.6 percent in 2024, banking on a robust turnaround in the second half.
According to the research house, the manufacturing condition is anticipated to experience further improvement, primarily driven by the expected upswing in technology cycle and China's gradual recovery.
The growth trajectory will also be fueled by higher demand from regional peers and better-than-anticipated performance among advanced economies.
Stable domestic manufacturing, bolstered by the services sector's continued growth on increased tourist arrivals and consumer spending, is also expected to maintain momentum, it said.
MIDF Research remains cautious, noting IPI growth this year may be constrained by downside risks such as weaker-than-expected economic growth in major economies, and potential disruptions to the global supply chain from the escalation in geopolitical tensions. ■