• Exports decreased 3.1% yoy in June

• Imports dropped at a faster 9.2% yoy

• Trade surplus increased sharply to RM10.3bn

• Total trade for 2Q19 declined by 0.4% yoy but increased 5.9% qoq

• Exports of crude petroleum registered the first positive growth for the year

• Global trade dip yet again

• Escalation of trade war gives cloudy outlook for 3Q19

Malaysia’s exports unexpectedly fell by 3.1% yoy to RM76.2bn in June after a 2.5% increase in the previous month. This was the first decline in exports since March due to lower exports in electronics and electrical (E&E). Re-exports was valued at RM12.2bn registering a decrease of 22.3% yoy and accounted for 16.1% of total exports. However, domestic exports increased 1.7% or RM1.1bn to RM63.9bn. Meantime, imports dropped at a faster 9.2% yoy to RM65.9bn, the first decrease in imports in three months. As imports fell harder than exports trade surplus increased sharply to RM10.3bn in June, up RM4.3bn (+71.0%) from a year ago. It also registered an increase of 13.1% or RM1.2bn as compared to the previous month.

On a mom basis, exports shrank 9.5% whilst imports dropped 12.2%. On seasonally adjusted terms, exports and imports decreased 6.5% and 9.5% respectively.

Total trade for 2Q19 was valued at RM460.8bn, declined by 0.4% compared to RM462.8b in 2Q18. Exports increased of 0.2% yoy while imports contracted by 1.2% yoy. A trade surplus of RM30.2bn was recorded for the period, a growth of 11.1%. On a quarter-on-quarter basis, exports rose 4.0% and imports also expanded 8.1%. Total trade rose by 5.9% qoq but trade surplus declined by 18.4% qoq.

For the first half of 2019, exports declined by 0.2% yoy and imports decreased by 1.8% yoy. Total trade contracted by 1,0% to RM895.9bn while trade surplus expanded by 10.9% to RM67.1bn.

Source: BIMB Securities Research - 5 Aug 2019