Last week’s highlights

• Ministry of Finance Malaysia (MOF) had released its 63rd LAKSANA report

• Malaysia’s export growth moderated to 27.2% yoy in June

• Malaysia’s producer inflation cost rose by 11.5% in June 2021

• The FBM KLCI fell by 1.89% or 28.84 points for the week to settle at 1,497.60 points

• US real GDP "advance" estimate for 2Q21 grew 6.5% qoq

• US personal consumption expenditures (PCE) price index rose by 4.0% yoy in June

• In the 2Q21, preliminary flash estimate GDP increased by 2.0% in the euro area

• Taiwan GDP 2Q21 grew by 7.47% yoy

• South Korea’s GDP expanded by 5.9% yoy in 2Q21

• Fed and Columbia central bank kept the interest rates unchanged.

MALAYSIA ECONOMY

• According to the Ministry of Finance Malaysia (MOF) 63rd LAKSANA report, under BSN Pemerkasa Financing, a total of RM45.985m was disbursed to 2,042 Micro SMEs. For Lestari SME Bank Financing Scheme, a total of 15 Micro SMEs had received RM3.902m. Under the global online workforce (GLOW), a total of RM13.76m had used to fund 10,200 participants. For the Mystep program, 39,339 persons have been employed under the program in both the public and private sectors. As of 16 July, 150,757 persons have enrolled under the recruitment incentive program and training assistance under various agencies.

• Malaysia’s export growth moderated to 27.2% yoy in June from RM82.9bn in June2020 to RM105.5bn. Exports sustained double-digit growth for the fifth straight month but moderated from May print of 47.0% yoy. Domestic export stood atRM84.7bn contributed 80.3% to the total exports, grew by 21.0% yoy. The re-exports which were valued at RM20.8bn, surged by 61.2% yoy. Meanwhile, imports surged by 32.1% to RM83.2bn in June compared to 48.4% growth in the previous month. Total trade rose by 29.3% toRM188.7bn, sustaining the seventh consecutive month of expansion. Trade balance recorded a surplus of RM22.2bn in June, an increase of 11.7% from RM19.9bn from a year ago. On a month-on-month basis, exports, imports and total trade posted increases of 14.3%, 5.9%, and 10.4% respectively. Likewise, trade surplus widened by 61.7%during the period.

• The Producer Price Index (PPI) local production rose by 11.5% in June 2021, moderated from 11.9% growth in the previous month. The performance was the fourth month of the increase of inflation cost. The growth was driven by the increase in all sub-indexes: the mining index (64.4%); agriculture, forestry & fishing index (29.8%); manufacturing index (6.7%); water supply (1.6%). However, electricity & gas supply went down by 0.2% compared to 0.1% rise in May. Meanwhile, PPI by stage processing, the index of crude materials for further processing moderated from 53.6% to 39.2% in June 2021. The index of Intermediate materials, supplies & components increased by 9.0%, while the finished goods recorded an inflation of 0.3% in June. In 2Q21, producer inflation rose by 11.3% annually while increased by 2.6% qoq.

Source: BIMB Securities Research - 2 Aug 2021