• IPI eased to 4.3% yoy in January

• IPI expansion was underpinned by manufacturing and electricity sectors

• Manufacturing sales sustained double digit growth in January

• Manufacturing sales increased 13.1% yoy; down 3.4% mom in January

• Productivity went up by 10.7% yoy in January

• Global semiconductor sales increase 26.8% yoy in January

• Global industrial production rises moderately in January

• Industrial production prognosis remains favourable for the year ahead

IPI eased to 4.3% yoy in January

Malaysia’s industrial production index (IPI) eased to 4.3% yoy in January, down from a 5.9% gain in the previous month. Still, January’s IPI marked the fifth month of expansion since September 2021. The expansion of IPI was due to a recovery in domestic demand and sustained global demand compared to the preceding year. The expansion in IPI for January 2022 was attributable to the improvement in the index of manufacturing (+6.8%) and electricity (+7.7%). However, mining fell faster by -5.1%, down from -2.6% in the prior month.

On a monthly basis, the IPI in January contracted by 1.2%, caused by mining and manufacturing segments. The on-month contraction was caused by weather impacts, supply disruptions, and eased global demand. The negative growth was seen in manufacturing (-1.7%) and mining output (-0.02%), which outweighed the growth in the electricity index (+0.6%).

In seasonally adjusted terms, IPI in January 2022 contracted by 1.4%. The negative growth was due to the manufacturing index (-1.8%), mining index (-0.5%), and electricity index (-0.02%).

Source: BIMB Securities Research - 14 Mar 2022