The Weak Ahead

IPI data

THE industrial production index (IPI) for May 2023, due on Wednesday, is likely to suggest a slowdown in manufacturing activity.

Economists expect IPI to decline 2.5% in May from a contraction of 3.3% in April 2023.

The seasonally adjusted S&P Global Malaysia manufacturing purchasing managers’ index (PMI) fell slightly to 47.7 in June from 47.8 in May to indicate a 10th consecutive moderation in operating conditions that was the strongest since January.

The Statistics Department is also expected to release retail sales and unemployment rates this week.

According to Trading Economics’ global macro models and analysts’ expectations, the IPI is expected to contract by 6.8% while the unemployment rate is expected to be 3.6% by the end of this quarter.

Singapore GDP

SINGAPORE is set to release its second-quarter (2Q) gross domestic product (GDP) figures this week.

UOB Global Economics & Markets Research expects 2Q GDP to contract by 0.4% quarter-on-quarter (q-o-q) seasonally-adjusted (+0.1% year-on-year or y-o-y), from minus 0.4% q-o-q (+0.4% y-o-y) in 1Q.

The research house said if its expectations come to past, that will imply Singapore entered into a technical recession in the first half of 2023, the first since the onset of the pandemic (1Q20), largely driven by the weakness in manufacturing.

UOB kept its full-year growth outlook for 2023 at 0.7% to reflect its more cautious external outlook.

ING expects 2Q GDP to bounce back, with a shallow expansion of 1.4% y-o-y. Growth will likely be stuck in this range until global trade prospects improve.