Financial news: When the economy is supported by domestic consumption
Hokkien: Eh chan beh see means “can complain means won’t die”
Too many friends I know say that the Malaysian economy is bad. These friends did these things: two went to Norway… one bought a new EV… MANY have the top of the range branded smartphone… most others are on holidays where the hotels they stay really does show that they have the money to pay. Let’s say I believe all of them. It meant that they represent minority then? Since, the Malaysian economy in Q1 2023 is estimated to be GROWING by 5.7 percent and the main reason for this expansion in economy is domestic consumption.
In other words, Malaysians buying lots of stuffs or spending lots of money here within this country which many friends say economy is bad. Ask any economist and they would tell you that if the expectation is that the economy is NOT going to do well, chances are they will NOT be spending their money because they are worried they would not get it back! So, this is what I say as “eh chan beh see…” Yes, I am a Hokkien.
Article in themalaysianreserve.com CGS-CIMB Research economists estimated that Malaysia’s economy has grown by 5.7% year-on-year in the first quarter of 2023 (1Q23).
The strong services sector and improvements in the labour market were key factors behind the growth, with distributive trade contributing 45.2% to the services index and growing by 10.1% in 1Q23.
CGS-CIMB economists Nazmi Idrus and Mas Aida Che Mansor said, “Based on the available data, which covers more than 80% of Malaysia’s GDP, we estimate that the economy expanded by 5.7% year-on-year (yoy) in 1Q23, softer compared to the 7.0% in 4Q22 but still relatively robust, in our view.” Please do read the report in full here: Article in themalaysianreserve.com
What happens if the economys is really growing robustly for 2023?
Many Malaysians would still continue to complain and at the same time may spend more. That’s good. Many Malaysians may say that the numbers are incorrect. Haha. Whatever. One more thing that will most probably happen is that the interest rate will rise further. This is because growth in economy should be moderate and should not show signs of heating up too much. The interest rate rise will seek to cool down speculative activities. This has been happening all over the world yeah. It’s like a sudden release of pent-up demand due to the Covid-19 lockdowns previously.
What are the other countries where the rates rose?
Just google for the news yeah.
Yes, I do think if the whole world kept increasing their rates, Malaysia has to follow. Else, people will kept saying that because of the rising rates in other countries, therefore ringgit will depreciate. Happy reading.
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