- Robust exports during the start of 4Q15. Overseas shipment expanded by 16.7% YoY to RM75.8bil in October (September: +8.8% YoY), driven by most export products except shipments of petroleum. Specifically, the exports growth was supported by E&E, which surged by 22.7% vs. +13.6% in September. Meanwhile, contractions were notable for exports of crude petroleum (- 8.7% YoY), LNG (-16.1%) and petroleum products (-21.2%).

- Singapore remains the largest export market for Malaysia. In terms of exports markets, Singapore remains the largest export market for Malaysia accounting for 13.8% of Malaysia’s total exports. Growth wise, shipments to Singapore /China /US had increased by 12.2% /25.9% /30.5% YoY, respectively. Meanwhile, exports to Japan rebounded to a +5.1% in October 2015, following two successive months of contractions. Main contributors to the increase of exports to Japan were E&E products (electronic integrated circuits), crude petroleum as well as machinery, appliances and parts.

- Imports registered a slight contraction due to the decline in intermediate goods. Total imports slipped to a minor contraction of 0.4% to RM63.7bil in October, from +9.6% in September. The decline was attributable to intermediate goods which fell by 9.7%, due mainly to lower imports of electronic integrated circuits. Both capital (+18.5% YoY) and consumption goods (+34.1%) grew at a healthy but narrower pace compared to the preceding month. For the capital goods, the increase was attributable to higher imports of cellular phones. Meanwhile, imports of consumer goods were driven by food products and medicament.

- A boost in trade balance to RM12.2bil in October. Total trade surged by 8.2% YoY to RM139.5bil in October (September: +9.1% YoY). Also, trade balance registered a surplus of RM12.2bil (vs. RM9.7bil in September). On a YTD basis, net trades had advanced by 21.5% YoY to RM76.1bil. Slower YTD exports growth of 1.5% was accompanied by a contraction for imports of -0.7%.

- Healthy trade balance during the start of 4Q15. GDP growth in 4Q15 will be supported by healthy net trades in tandem with the positive development in the domestic front. For 3Q15, trade balance had registered a surplus of RM22.2bil. In October 2015, net trades had already amounted to RM12.2bil (which is about half of the surplus in 3Q15 and more than 11x higher than the surplus of RM1.1bil in the preceding year). For 4Q15, Malaysia’s growth will probably remain steady at 4.5-5.0% on the

Source: AmeSecurities Research - 7 Dec 2015