Consumer spending in Malaysia to increase 5.8% in 2017
It will grow at an annual average of 5.3% between 2017-2021.
BMI Research reported that consumer spending in Malaysia is set to increase. The rise will be brought about the increasing disposable income.
Real household spending growth in Malaysia will continue to expand the medium term. However, it will be modest on the back of an uptick in inflation and slightly weaker currency. Household spending will become more dynamic over the medium term as the share of non-essential spending rises. BMI foresees household spending real to grow at an annual average of 5.3% between 2017-2021. In 2017 we project a y-o-y increase of 5.8%
Rising disposable incomes will foster discretionary spending, highlighted by robust growth in education; restaurants and hotels; and recreation and culture spending. According to BMI, these categories are set to grow at an annual average rate of 8.7%, 8.5% and 8.2% respectively.
Consumer spending in Malaysia will benefit from a youthful and increasingly urbanised population; rising household incomes; and low levels of unemployment. The growing middle class and relatively low inflation will help generate demand for non-essential items and luxury goods.
Here’s more from BMI:
The country is also experiencing a shift in retail formats with the government supporting development of 'big-box boulevards' - concentrated centres of shopping outlets on the outskirts of cities. This is helping to attract both domestic and international retailers, who are keen to capitalise on the forecast rise in household spending in the retail sectors. We forecast total household spending to expand at an annual growth rate of 7.5% between 2017 and 2021 and reach a total figure of MYR1trn (up from MYR774bn in 2017), which converts into USD172bn in 2017 and USD265 in 2021.