Zeti: GDP up 4.7% for Q3, ringgit significantly undervalued

It’s okay, as usual I have yet to see even a single Facebook sharing about this piece of positive news. Reported in many medias, for Q3 2015, Malaysia’s gross domestic product (GDP) expanded by 4.7 percent. It’s lower than Q2 but is within expectations of majority of all analysts. It also meant that the 2015 projected GDP growth remain intact. It gained from export numbers and domestic private sector demand growth. In fact domestic demand rose 4.4 percent. In a statement, Bank Negara said, “The private sector continued to be the key driver of growth during the quarter. On the supply side, all economic sectors continued to expand during the quarter.”
The two key sectors supporting the economy grew too. The services and manufacturing sectors grew 4.4 percent and 4.8 percent respectively. When it comes to the Malaysian economy, always watch these two sectors. Read here: Malaysian economy? Always watch Services and Manufacturing Currently, Malaysia has the three usual signs usually associated with a fundamentally strong and growing economy. They include our current account in surplus (exports higher than imports), unemployment at about 3 percent (In economics, full employment) and inflation within Malaysia’s long-term average. These three are most often quoted when analyst are looking for some signs about the state of the economy.
The US has a trade deficit and a 5 percent unemployment rate currently. Bank Negara Malaysia Governor Tan Sri Dr Zeti Akhtar Aziz also said that Ringgit may recover when the US Federal Reserve normalises interest rates and “domestic issues” in Malaysia are resolved. She said, “Our export growth remains fairly strong, it has not moderated to the extent that we expected.” In fact the Malaysian exports and industrial production beat economists’ estimates in September. End of a brief but encouraging report. This growth is achieved amidst slowdown throughout the world. Oh yeah, potentially global recession in 2016 too. Read here: Getting ready for the next global recession? Happy reading.
written on 14 Nov 2015
Next suggested article: Malaysia: Exports still up, exceeding expectations