This article first appeared in The Edge Malaysia Weekly on May 8, 2023 - May 14, 2023
It is a busy week ahead on Malaysia’s economic calendar. Amid the ongoing recovery from the impact of the Covid-19 pandemic, market participants will be keeping an eye on Malaysia’s gross domestic product (GDP) data for the first quarter of 2023, due on Friday.
The median of economists’ estimates in a Bloomberg survey was for growth of between 4.5% and 5.1% in 1Q from a year earlier.
CGS-CIMB Research anticipates 1Q GDP growth could surprise on the upside, given the positive tone in Bank Negara Malaysia’s Monetary Policy Committee’s statement on the Malaysian economy last week. “Bank Negara had hinted that growth was robust in 1Q, possibly attributed to ‘resilient’ household spending underpinned by better labour market conditions, indicating support for domestic demand,” says the research firm in a May 3 note.
Last Thursday, Bank Negara raised its overnight policy rate by 25 basis points (bps) to 3% after two consecutive pauses this year.
In its weekly outlook report last Friday, UOB Global Economics and Markets Research forecasts that the local economy will expand at 4% year on year in 1Q from a 7% y-o-y growth in 4Q2022.
On Tuesday, Bank Negara will release data on its international reserves as at April 28. Reserves stood at US$115.9 billion as at April 14.
The Department of Statistics Malaysia (DOSM) will announce the Industrial Production Index (IPI) for March on the same day. UOB estimates a 0.6% y-o-y growth, from 3.6% y-o-y in February. Other data to be released by DOSM includes monthly manufacturing statistics for March. On Wednesday, it will announce the wholesale and retail trade performance for March. Malaysia’s international investment position for 1Q will be unveiled on Friday.
At the courts, the 1Malaysia Development Bhd (1MDB)-Tanore hearing, which took a break on April 19, will resume from Monday to Thursday before Judge Datuk Collin Lawrence Sequerah, who will preside over the case at the High Court. Former prime minister Datuk Seri Najib Razak is on trial for four counts of abuse of power and 21 counts of money laundering involving RM2.28 billion of 1MDB funds.
The money laundering and tax evasion trial of Najib’s wife, Datin Seri Rosmah Mansor, will begin at the High Court on Friday before Judge K Muniandy. Rosmah faces 17 charges involving RM7.1 million transferred into her personal bank account between 2013 and 2017.
Regionally, the Philippines will release its 1Q GDP numbers on Thursday. UOB estimates a 6.2% y-o-y growth, from a 7.1% y-o-y growth in 4Q2022. It also expects Hong Kong’s final GDP numbers, which will be released on Friday, to remain unchanged from preliminary numbers at 5.3% quarter on quarter and 2.7% y-o-y.
The 42nd Asean Summit will take place from May 9 to 11 in Labuan Bajo, East Nusa Tenggara, Indonesia. Issues set for discussion include the situation in Myanmar, the Timor-Leste roadmap for membership and the code of conduct in the South China Sea. UOB highlights that Indonesia will outline the 2045 vision statement that Asean leaders are expected to endorse.
Australian Treasurer Jim Chalmers will deliver his second Australian Budget on Tuesday. According to UOB, he seeks to balance cost-of-living relief while trying to avoid further fuelling inflation.
In the UK, the coronation of King Charles III and his wife, Camilla Rosemary Shand, as king and queen of the UK, will take place at Westminster Abbey on Saturday (May 6). This is the first coronation to be held in 70 years. It is estimated that the “scaled down” event, which will include the king’s procession and a star-studded concert in Windsor Gardens, could run to between £50 million (RM279 million) and £100 million. The cost is borne by the UK government.
On Thursday, the Bank of England will make its monetary policy decision. Citing a Bloomberg survey, UOB says all 33 economists polled expect the BoE to hike its official bank rate by 25bps to 4.5%. UOB expects a similar hike.
The UK will also release its 1Q GDP report on Friday. Bloomberg estimates a 0.2% y-o-y growth.
On Wednesday, the US will release April Consumer Price Index numbers. UOB estimates a 0.4% month-on-month growth and a 5% y-o-y growth from a 0.1% m-o-m and 5% y-o-y increase respectively in March. US initial jobless claims data is also due on Thursday.
Meanwhile, US President Joe Biden is scheduled to meet with the Congressional leaders on Tuesday to discuss the debt ceiling — the total amount of money that the US is authorised to borrow to fund the government and meet its financial obligations. On Jan 19, the US officially hit its debt limit. The borrowing cap is set at US$31.38 trillion (RM139 trillion).
G7 finance ministers and central bankers will meet in Niigata, Japan, this week from May 11 to 13.
On the local corporate front, Edelteq Holdings Bhd will launch its prospectus on Tuesday, in conjunction with its upcoming listing on the ACE Market of Bursa Malaysia. The company provides engineering support for integrated circuit assembly and test processes in the semiconductor industry.
On the same day, accounting software developer Autocount Dotcom Bhd, en route to a listing on Bursa’s ACE Market, will hold its initial public offering listing ceremony.
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