Last week’s highlights

• Ministry of Finance Malaysia (MOF) had released its 73rd LAKSANA report

• Malaysia’s leading Index (LI) for August 2021 contracted by 2.3% yoy

• The FBM KLCI fell by 0.64% or 10.20 points for the week to settle at 1,588.08 points

• IHS Markit Flash US Manufacturing posted 59.2 in October

• US industrial production (IP) contracted by 1.3% mom in September

• Euro area annual inflation rate surged to 3.4% in September, a 13-year high

• UK headline inflation rose to 3.1% yoy in September

• China’s 3Q21 GDP grew at a weaker pace of 4.9% yoy

• Japan's headline inflation increased by 0.2% in September 2021

• Singapore's total trade rose by 18.7% in September 2021

• BI and PBoC kept the policy rate unchanged, CBRT cut, while CBR and Hungary tightening

• Week Ahead Economic Review

MALAYSIA ECONOMY

• According to the Ministry of Finance Malaysia (MOF) 73rd LAKSANA report, in supporting the agriculture and food industry, a total of RM221.32m has been disbursed under the Agrobank Microcredit Financing Scheme, benefiting 17,734 agricultural Micro SMEs. The total guarantees approved under the Danajamin Prihatin Guarantee Scheme (DPGS) were RM2.025bn for 56 companies. Meanwhile, under technical and digital adoption for SMEs and mid-tier companies (MTC) programs, a total of RM86.4m has been distributed to 13,886 recipients. For Indian Community Entrepreneur Development Scheme, a total of RM19.75m was disbursed to 844 eligible SMEs. The government also had introduced various programs to support employment conditions, particularly via Recruitment Incentive Program or PenjanaKerjaya under the PERKESO. Under PenjanaKerjaya 1.0, 2.0, and 3.0 programs, RM1.094bn was disbursed as of 13 October, benefiting 35,566 employers and 256,684 employees. Since last year, 2,973,573 allowance claims amounting to RM1.119bn have been approved for the front-liners. The disbursed amount of wage subsidy 1.0 and 2.0 schemes stood at RM12.946bn and RM1.396bn, respectively. For wage subsidy 3.0 and 4.0, a totaled RM3.137bn and RM1.1bn were channeled to the employers as of 8 October 2021.

• Leading Index (LI) for August 2021 contracted by 2.3% yoy following a 4.0% drop in July. The contraction in LI was mainly due to a reduction in the number of housing units approved. However, the LI returned to positive growth of 1.1% mom, reversing a 0.6% drop in July, primarily led by a hike in expected sales value in the manufacturing sector. The Coincident Index (CI), which measures the overall current economic performance, rebounded to 4.2% mom, a reversal of a 2.5% drop in July. Meanwhile, the CI registered a negative growth of 1.6% yoy, moderating from a 5.2% contraction in July.

• Malaysia’s CPI reaccelerated to 2.2% yoy in September compared to 2.0% yoy in the previous month. This was the eighth straight month of inflation since February 2021. On a monthly basis, consumer price rose by 0.2% compared to a flat growth in the previous month.

Source: BIMB Securities Research - 25 Oct 2021