, Malaysia
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Malaysia GDP growth to fall 5% in 2018

This is due to low investments.

VP Bank reported a forecast in Malaysia’s GDP growth, falling from 5.9% in 2017 to 5% this year.

Investments are expected to decline from 6.4% in 2017 to 3.8% in 2018, as Malaysia remains a “challenging market” for alpha investors.

“The critical aspect concerning Malaysia are a quite expensive fundamental valuation. In spite robust economic developments, earnings momentum slows down further and the country – as investment region – is relatively unattractive versus other ASEAN countries,” VP Bank said.

Exports increased last year, which was mainly due to the Asia-wide tech cycle. The rising palm oil and LNG volumes and prices also supported the increase, including the rise in rural incomes.

However, VP Bank said, “We expect external conditions to remain supportive in 2018, but export volume growth will likely moderate from its 2017 pace, and imports should pick up further alongside various big-ticket infrastructure projects.”

Further, inflation rate is expected to inch down to 3.1% in 2018, whilst private consumption will also fall to 5.3%.

 

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