RHB | Malaysia | GST Impact To Gradually Wane In 2H 2015

Economic Research	23 June 2015
Malaysia
Economic Outlook
GST Impact To Gradually Wane In 2H 2015 Malaysia’s real GDP growth was sustained at 5.6% y-o-y in 1Q 2015, compared with a revised +5.7% in 4Q 2014 and +5.6% in 3Q, boosted by the front-loading of spending ahead of the implementation of GST. However, we will likely see a payback in 2Q, as business and consumer spending take a breather post the GST. Nonetheless, the effect of the GST will likely gradually wane moving forward and we expect real GDP to pick up slightly to 5.2% y-o-y in 2H 2015, from an estimated +4.8% in 1H. For now, we are maintaining our forecast for real GDP growth at 5.0% in 2015, albeit slower compared to +6.0% in 2014, but we see downside risk to our forecast. Economist:  Peck Boon Soon  | +603 9280 2163 Economist:  Vincent Loo Yeong Hong  | +603 9280 2172
To access our recent reports please click on the links below: 17 Mar: Slower Growth Prospects, Inflation Hold Up By GST 08 Dec:  GST and Lower Crude Oil Price To Temper Growth In 2015 30 Sept: Slowing But Resilient Economic Growth In The 2H 30 June: More Moderate But Resilient Growth Envisaged For 2H 24 Mar:  Growth Lifted By Stronger Exports Amidst Resilient Domestic Demand