August's stronger Leading Index points to positive GDP growth

  • Economy Premium
  • Tuesday, 24 Oct 2017

KUALA LUMPUR: Malaysia's economy is expected to continue growing positively in the near term based on as the Leading Index (LI), which monitors the economic performance in advance, increased in August 2017.

The Statistics Department said on Tuesday the LI rose 1.9% to 120.3 points in August from 118.1 points in Juuly.

The firmer growth was underpinned by the increase in the mumber of housing units approved (0.7%), number of new companies registered (0.6%) and real imports of semiconductors (0.5%). 

“The annual change of LI improved further to 2.6% in the reference month (August),” it said.

Meanwhile, the Coincident Index (CI) which measures the current economic activity, decreased 0.4% in August 2017. 

The department said three components of the CI which slipped were the volume index of retail trade (-0.3%), capacity utilisation in manufacturing sector (-0.2%) and total employment in manufacturing sector (-0.2%). 

However, the annual change of CI improved further to 4.5% in August.

The increase is in line with the growth of Gross Domestic Product at constant price which expanded 5.8% in the second quarter of 2017 from 5.6% in the previous quarter.

“The annual change of LI and CI continued to show a positive annual change in August 2017. Supported by the level of both Diffusion Indexes above 50.0%, it is expected that the Malaysia’s economy to continue growing positively in the near term,” it said.

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