Malaysia's August factory output lower than expected

by **Cals** Fri 11 Oct 2013, 08:32

Published: Friday October 11, 2013 MYT 12:00:00 AM
Updated: Friday October 11, 2013 MYT 8:01:03 AM
Malaysia's August factory output lower than expected
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Manokaran: ‘We are still confident that the improving outlook for the industrial sector is still intact, especially in manufacturing.’

PETALING JAYA: The industrial production index (IPI), which measures activities in the manufacturing sector, expanded 2.3% year-on-year in August, lower than the 7.5% median expectations of economists.
Data from the Statistics Department showed the expansion was largely due to increases in the manufacturing and electricity indices, which rose 4.6% and 5.1% respectively while the mining index declined 4.6%.
July’s IPI has been revised to 7.5% from 7.6%.
On a seasonally adjusted basis, the August IPI fell 4.6% month-on-month with the drop due to declines in the manufacturing, mining and electricity indices.
Alliance Research chief economist Manokaran Mottain pointed out that the drop in the IPI should not be of too much concern as exports have risen for a second straight month and that the drop was also due to fewer working days due to Ramadan.
“We are still confident that the improving outlook for the industrial sector is still intact, especially in manufacturing (up 4.6% versus 5.5% gain in July),” he said.
Manokaran said this was supported by continued gains in the manufacturing indicators and still stronger rebounds seen in purchasing managers indices data for August and September.
This suggested sustained recovery in demand from the major advanced economies, according to the economist.
Meanwhile, a separate release showed that manufacturing sales value gained 5.1% in August compared to a year ago.
The July sales value was revised to 3.9% from 3.8%.