Last week’s highlights

• Ministry of Finance Malaysia (MOF) had released its 62nd LAKSANA report

• Malaysia’s CPI rose slower by 3.4% yoy in June

• Leading Index (LI) for May 2021 eased to 6.9% yoy

• The FBM KLCI rose by 0.06% or 0.96 points for the week to settle at 1,523.44 points

• IHS Markit Flash U.S. Manufacturing PMI posted 63.1, an increase from 62.1 in June.

• US existing home sales rose 1.4% mom in June 2021

• Government debt to GDP ratio in the euro area elevated to 100.5% in 1Q21

• UK’s retail sales volumes grew slower in June 2021, with an increase of 9.7% yoy

• Japan's core inflation hit a 15-month high since Mar 2020 by 0.2% yoy

• Singapore’s headline consumer price index (CPI) increased 2.4% yoy in June 2021

• Taiwan industrial production index increased 18.37% in June 2021

• ECB, PBOC, BI, and SARB kept the interest rates unchanged, while CBR hikes.

MALAYSIA ECONOMY

• According to the Ministry of Finance Malaysia (MOF) 62nd LAKSANA report, under the Agrobank Microcredit Financing Scheme, a total of 13,871 agricultural Micro SMEs had received RM171.64m fund. Furthermore, a total of RM4.26m has been disbursed to 520 recipients under CENDANA initiative. Under BNM SMEs soft loan funds, a total of RM12.26bn was approved to 25,894 applicants.

• Malaysia’s CPI rose slower by 3.4% yoy in June compared to 4.4% yoy in the previous month. June’s headline inflation retreated to record a modest rate within the BNM inflation target of 2.5-4.0% for 2021. The inflation data remained relatively inflated following the low base effect, higher fuel prices, energy, utilities, vegetable oil, foods, and household items. On a monthly basis, consumer prices increased 0.1% compared to 0.0% in the previous month. Non-food price index increased slower of 2.7% yoy (May: +5.9%; Apr: +6.1%) while food price index increased by +1.3% yoy (May: +1.5%; Apr: +1.9%). CPI without fuel, which covers all goods and services except RON95, RON97 and Diesel, increased 1.5% in June (May: +1.6%; Apr: +1.7%). Meanwhile, increased in durable goods price was flat at 1.1% yoy (May: +1.1%; Apr: +1.3%). The prices of semi- durable goods declined by -0.3% yoy (May: -0.4%; Apr: -0.3%), while non-durable goods rose by 7.9% yoy (May: +10.8%; Apr: +11.4%). Meanwhile, CPI in 2Q21 increased 4.1% yoy while on a quarterly basis, the CPI increased 0.5% qoq. The CPI for the period of January to June 2021 increased 2.2% as compared to the same period last year.

• Leading Index (LI) for May 2021 eased to 6.9% yoy, dropped from a 15.7% rise in April. The expansion in LI was mainly driven by real imports of other basic precious & other non-ferrous metals and the number of housing units approved. However, the LI slipped further by 2.9% mom, higher than 1.2% drop in April. The Coincident Index (CI), which measures the overall current economic performance, fell 1.3% mom in May. On a yearly basis, the CI registered a positive growth of 10.0%, slow down from 20.2% growth in April.

Source: BIMB Securities Research - 26 Jul 2021