Malaysia Industrial Production - 12 December 2023

Jumped to a five-month high in October, beating expectations

Industrial Production Index (IPI) rebounded strongly in October (2.7% YoY; Sep: -0.5%), marking its highest in five months and surpassing consensus (2.4%) and house forecast (2.3%)

  • The positive performance primarily stemmed from a broad-based expansion, led by the mining sector and the waning of the high base effect noted last year. This suggests that the recovery could accelerate into 2024, backed by a rebound in the external sector led by China and other emerging economies.
  • MoM (2.2%; Sep: 1.1%): Growth momentum expanded with the third straight month of positive expansion.

The manufacturing index expanded (0.9% YoY; Sep: 0.4%) for the second consecutive month, mainly supported by domestic-oriented industry and a smaller contraction in the export-oriented sector

  • Domestic-oriented: expanded to 6.7% (Sep: 5.8%) led by solid expansion in the manufacture of motor vehicles, trailers & semi-trailers (10.6%; Sep: 2.6%), and food processing products (9.4%; Sep: 8.2%).
  • Export-oriented: contracted for the fifth straight month albeit at a reduced rate (-1.5%; Sep: -2.0%). Growth continues to be hindered by weak electrical & electronic sector performance (-3.9%; Sep: -2.0%).
  • MoM (-1.3%; Sep: 2.1%): growth fell to a three-month low.