- The Industrial Production Index (IPI) for Malaysia registered a moderated growth of 5.4% YoY in September, driven by slower growth rates for the manufacturing segment and electricity (August: +6.5%).

- Manufacturing grew by 4.7% YoY, mining advanced by 7.1%, and electricity grew by 6.2% in September. In August, the manufacturing/mining/electricity indexes registered +7.4%/+3.6%/+8.4% YoY respectively.

- Elsewhere, we note that manufacturing sales had also slowed down in September in tandem with the moderated growth for the IPI during the month.

- Manufacturing sales value grew by 4.1% YoY totalling RM55.4bil in September(vs. August’s growth rate of 5.0% YoY).

- Refined petroleum products, which accounted for 23.1% of total manufacturing sales in September, had rebounded to register a growth of 4.9% totalling RM12.8bil in September (August: -7.5% YoY).

- Under the E&E segment, we note that the sales value for diodes, transistors and similar semiconductor devices had advanced at a softer pace of 8.6% YoY to RM5.1bil (August: +18.8% YoY).

- Also, electrical capacitors and resistors posted a growth of 26.1% to RM2.8bil in September (August: +39.2% YoY).

- Meanwhile, manufacture of passenger cars reverted to a contraction of 2.3% YoY to RM1.9bil in sales (August: +31.3% YoY).

- Based on the IPI for export-oriented industries for the month of August, growth had advanced to +6.2% (August: +3.2% YoY).

- The domestic oriented industries also registered a healthier growth of 10.9% in August vs. +3.3% in July, driven by the construction sector and stronger demand for consumer products.

- Private consumption continued to improve in September which augured well for the domestic-oriented industries during the month.

- Loans growth had advanced by 9.0% YoY in September compared to 8.6% in both July and August respectively.

- Going forth, factory output in October and November will be less dependent on exports despite the weak Ringgit currency as import orders are expected to remain lacklustre during those months.

Source: AmeSecurities