Thursday, July 18, 2024

Challenges in maintaining economic recovery

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KUALA LUMPUR: Malaysian economy is anticipated to face challenges in preserving the recovery momentum as the Leading Index (LI) which acts as an indicator of the future movement of the overall economy eased to 6.9 per cent in May 2021 year-on-year (y-o-y) after rising 15.7 per cent in April, said the Department of Statistics Malaysia (DOSM).

Chief statistician Datuk Seri Mohd Uzir Mahidin said the growth was driven by real imports of other basic precious and other non-ferrous metals and the number of housing units approved.

At the same time, he said, the LI declined by 2.9 per cent month-on-month with real imports of other basic precious and other non-ferrous metals (-1.2 per cent) particularly platinum was among the components that underpinned the decrease of LI.

“The growth rate of ‘smoothed LI’ remained above trend, however, moving downwards indicating the Malaysian economy is anticipated to face challenges in preserving the recovery momentum.

“The emergence of a new lethal variant of the COVID-19 has triggered pessimistic sentiment at global and national frontiers. Further to this, prolong movement restrictions in safeguarding lives may affect the prospects of recovery,” Mohd Uzir said in a statement today.

The Coincident Index (CI), which indicates the economic performance in the reference month, slowed to 10 per cent in May 2021 after registering 20.2 per cent annual growth in April 2021, he noted.

On the contrary, the monthly performance of the CI decreased 1.3 per cent in May 2021 due to a significant drop in the volume index of retail trade (-1.2 per cent), primarily caused by the decline of 15.8 per cent in the retail sale of automotive fuel in specialised stores, he added. – Bernama




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