-  The overall current account advanced to RM19.8bil in 1Q14 owing to the improvement in net trades during the quarter (4Q13: RM14.8bil).

-  As a percentage of nominal GDP, it registered 7.7% in 1Q14 compared to 5.6% in 4Q13.

-  The current account surplus improved as services account recorded a narrower outflow of RM2.7bil (4Q13: -RM4.1bil). Goods account had increased marginally to RM33.6bil (from RM33.3bil in 4Q13).

-  In the goods account, exports were mainly contributed by E&E, LNG and petroleum products. The top three exports destinations were Singapore, China and Japan.

-  Aside from that, lower outflows were recorded for the primary income account at RM6.4bil (4Q13: -RM10.0bil) while outflows in the secondary income account rose to RM4.6bil (4Q13: -RM4.4bil).

-  Owing to the improvement in external demand and a healthy trade surplus ahead, we envisage the current account to remain strong in 2014.

-  For full year 2014, current account is likely to register 7.4% of GDP. That compares to 4.0% of GDP in 2013.

-  Elsewhere, the capital account recorded a net outflow of RM2.0mil compared to -RM19.0mil in 4Q13. This was due to lower outflow in net capital transfers in 1Q14.

-  Meanwhile, the financial account recorded a net outflow of RM37.6bil (4Q13: -RM9.8bil). This was mainly due to higher net outflow in portfolio investment.

-  FDI recorded a higher net inflow of RM7.0bil (4Q13: +RM11.4bil). FDI inflows were primarily channelled into mining, financial & insurance, and real estate. The top three sources of FDI were Netherland, Hong Kong and France.

-  All in all, the balance of payment registered an outflow of RM17.3bil in 1Q14 (4Q13: -RM2.7bil). 

Source: AmeSecurities