Last week’s highlights

• Malaysia’s international reserves stood at USD111.3bn as of 13 August 2021
• Malaysia's labor productivity in 2Q21 dropped by 12.8%
• The FBM KLCI rose by 0.86% or 12.92 points for the week to settle at 1,518.03 points
• US’s IP rose by 0.9% mom in July; +6.6% yoy
• UK unemployment rate dropped to 4.7% in the three months to June
• In July, China’s retail sales rose 8.5% yoy
• Japan's economy grew by 7.5% yoy in 2Q21
• Thailand's economic growth rebounded by +7.5% yoy in the 2Q21
• Singapore's total trade rose by 19.0% in July 2021
• Indonesia's exports were valued at USD17.7bn, up 29.32% yoy
• RBNZ, PBOC and BI kept the interest rates unchanged.

MALAYSIA ECONOMY

• The international reserves of Bank Negara Malaysia (BNM) amounted to USD111.3bn as of 13 August 2021. The reserves position is sufficient to finance 7.9 months of retained imports and is 1.2 times total short-term external debt. Meanwhile, foreign currency reserves which the sub-components of the international reserves, stood at USD102.3bn, followed by gold (USD2.2bn), International Monetary Fund (IMF) reserves position (USD1.4bn), special drawing rights (SDRs) (USD1.2bn), and other reserve assets (USD4.2bn).
• Malaysia's labor productivity as measured by value-added per hour worked in 2Q21 dropped by 12.8%, a reversal of 0.4% growth in the first quarter of 2021. Labor productivity expressed as the ratio of value-added per employment rebounded to 13.6% in 2Q21 compared to a 0.4% decline in 1Q21. Likewise, employment improved 2.2% as compared to negative 0.04% in 1Q21. The growth also was due to the low base's comparison with the preceding year when the domestic activities were largely affected by nationwide lockdown. Value-added per hour worked in 2Q21 was RM40 per hour (1Q21: RM40 per hour), while value-added per employment was RM22,117 per person (1Q21: RM22,513 per person).
• The migration rate in Malaysia decreased by 0.1 percentage points to 1.5% in 2020 compared to 1.6% in 2018. The population aged one year and over who has migrated in 2020 dropped by 40k persons to 484.1k persons compared to 524.1k persons in 2018. Intra-state migrants in 2020 recorded a decrease to 58.4% as compared to 60.8% in 2018. On the other hand, inter-state migrants increased to 31.2% in 2020 from 28.5% in 2018. Meanwhile, international migrants from abroad to Malaysia was 10.4%, declined by 0.3 percentage points from 10.7% in 2018. The intra-state migrants in Malaysia were largely from urban to urban, increasing 6.1 percentage points to 73.0 per cent in 2020 compared to 66.9 per cent in 2018. The trend was in line with urbanisation in Malaysia which was estimated to be 76.7%. Overall, internal migration in 2020 due to the following family remained the main reason for migration at 45.3% compared to 44.2% in 2018. This was followed by career (23.6%) and environment (22.3%).

Source: BIMB Securities Research - 23 Aug 2021