KUALA LUMPUR: Malaysia is expected to post tepid economic growth in the first quarter of the year with a slight recovery in the second quarter, MIDF Research said.
“(Potential) weak growth in the first quarter is mainly due uncertainties over the trade negotiation between the US and China.
“This is in tandem with the pessimistic trend reflected by the Nikkei Manufacturing PMI for Malaysia, registering below 50 points for five consecutive months since October 2018,” the firm said today.
MIDF Reserach expects steady recovery towards the second quarter and the second half of the year amid gradual pick-up in commodity prices, strong domestic demand and receding trade war effects.
It noted that Brent crude oil price had improved steadily since January at an average of US$60.50 per barrel and latest in March at US$66.10.
“Global demand is expected to recover particularly when the US and China strike a deal soon. On domestic front, full-employment condition and shallow inflationary pressure are key supporting factors on the domestic demand.
“In addition, further announcements on government-related infrastructure projects would provide positive sentiments to the economic growth,” MIDF Research noted.