Last week’s highlights

• Ministry of Finance Malaysia (MOF) had released its 65th LAKSANA report

• Malaysian economy increased double-digit to 16.1% in 2Q21

• Malaysia’s total revenue of services sector in 2Q21 recorded RM404.5bn

• The FBM KLCI rose by 1.03% or 15.31 points for the week to settle at 1,505.11 points

• US headline inflation rose by 5.4% yoy in July

• US Producer Price Index (PPI) for final demand rose by 7.8% in July

• UK’s GDP grew by 22.2% yoy in the 2Q21; +4.8 qoq sa

• China’s consumer price index (CPI) rose 1.0% yoy in July

• Philippines GDP grew by 11.8% yoy in the 2Q21

• Taiwan's preliminary estimates GDP grew by 7.43% yoy in the 2Q21

• BSP and CBRT kept the interest rates unchanged, while Mexico hikes.

MALAYSIA ECONOMY

• According to the Ministry of Finance Malaysia (MOF) 65th LAKSANA report, under BNM-SMEs soft loans funds, a total of RM12.28bn was approved to the 25,927 applicants. For BSN-SMEs digital financing, a total of RM82.32m was disbursed to the 30,938 businesses. Meanwhile, under the tourism sector financing PENJANA, 336 applications were approved with total funding of RM66.6m. For technical and digital adoption for SMEs and mid-tier companies (MTC), a total of RM79.25m has been distributed to 13,877 recipients. As of 30 July, 150,908 persons have enrolled under the recruitment incentive program and training assistance under various government agencies. As of reporting date, a total of RM941.38m had been channeled based on 2,580,506 claims to the front-liners as allowance. The disbursed amount of wage subsidy 1.0 and 2.0 schemes stood at RM12.914bn and RM1.334bn.

• Malaysian economy increased by double-digit to 16.1% in 2Q21 compared with the -0.5% contraction in 1Q21. The performance ended the four consecutive quarters of contraction mainly attributed to robust external demand. The low base effect also led to substantial growth in domestic demand, provided overall support to the growth. The economic performance in the pandemic era was also measured on a monthly basis where April surged by 40.1%, May moderated to 19.8%, while June slipped to a negative 4.4%. On a quarter-on-quarter seasonally adjusted, GDP slipped into double-dipped contraction by 2.0% (1Q21: +2.7%). For the first half of 2021, Malaysia’s economy grew 7.1% as compared to a negative 8.4% in 1H 2020.

• Malaysia’s total revenue of services sector in 2Q21 recorded RM404.5bn, dropped 5.6% qoq (1Q21: -1.7%; 4Q20: +1.7%). The negative growth was attributed to the wholesale & retail trade, food & beverages and accommodation segment (-RM22.1bn; -6.4%). However, the e-commerce segment grew by 5.1% qoq, up from 3.8% in 1Q21. Meanwhile, total revenue on annual comparison rebounded to record positive growth of 20.5% yoy in 2Q21, reversing a 2.1% decline in the previous quarter (4Q20: -5.1%). The performance of e-commerce showed double-digit growth of 23.3% to RM267.6bn in 2Q21.

Source: BIMB Securities Research - 16 Aug 2021