Malaysia’s December industrial production index up 3.4%

PETALING JAYA: Malaysia’s industrial production index (IPI) expanded 3.4% year on year (yoy) in December 2018, driven by increases in all sectoral indices, including manufacturing (4.4%), electricity (2.7%), as well as mining (1%).

MIDF Research said this suggests an improvement in fourth quarter gross domestic product (Q4 GDP) growth.

“For Q418, we expect Malaysia’s GDP to expand at a stronger pace of 5% given that overall IPI growth averaged at 3.5% yoy, fastest since Q218,” it said in a research note today.

The Statistics Department said Malaysia’s IPI for the whole of 2018 increased 3.1% compared with 2017, contributed by the growth in manufacturing sector (4.8%) and electricity sector (3.7%). However, the mining sector declined by 1.9%.

The 4.4% growth in the manufacturing sector index in December 2018 was driven by electrical and electronic equipment products (7.2%), transport equipment and other manufactures products (7.0%) and petroleum, chemical, rubber and plastic products (3.6%).

The mining sector index recorded an increase of 1% in December 2018 against the same period in 2017, driven by the growth in crude oil index (2.5%) while the natural gas index dipped by 0.2%.

The electricity sector index expanded 2.7% in December 2018 as compared with December 2017.

MIDF Research forecast IPI growth of 2.9% for 2019 with 3% to 4% during the first half of the year.

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