Tuesday, March 14, 2017

Industrial Production Eases on Slower Mining Activities

Economic Research
13 March 2017

Economic Update

The Industrial Production Index (IPI) slowed to 3.5% YoY in January, from +4.7% in December, on the back of a slowdown in mining activities and electricity output. Looking ahead, we envisage real GDP to hold up at 4.5% YoY in 1Q, bringing full year growth to 4.5% in 2017, from +4.2% in 2016 on account of:
1.   A sustained increase in domestic demand, on the back of resilient consumer spending;
2.   A modest rise in public spending and private investment;
3.   A stronger-than-expected recovery in exports, on higher commodity prices.
The slowdown in industrial production in December was on the back of a slower growth in mining activities and electricity output. This was mitigated by a faster rate of growth in manufacturing activities.
In tandem with the pick-up in manufacturing output, manufacturing sales inched higher, along with a pick-up in hiring during the month.

Economist:  Vincent Loo Yeong Hong  | +603 9280 2172
Economist:  Aris Nazman Maslan  | +603 9280 2184

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