KUALA LUMPUR, July 12 (Xinhua) -- Malaysia's Industrial Production Index (IPI) increased by 3 percent in May as compared with the same month of the previous year, driven mainly by manufacturing sector.
Malaysian Statistics Department said in a statement Thursday, the growth in May 2018 was supported by the increase in the index of manufacturing by 4.1 percent, and the index of electricity by 2.6 percent.
Meanwhile, the index of mining fell 0.5 percent, due to the fall in the natural gas index. The crude oil index, however, increased by 4.7 percent.
The major sub-sectors of manufacturing which registered increases in May were electrical and electronic equipment (E&E) products; petroleum, chemical, rubber and plastic products, as well as non-metallic mineral products, basic metals and fabricated metal products.
Malaysian statistics department also revealed that the manufacturing sales in May grew 5.5 percent year-on-year to 65.3 billion ringgit.
In a note Thursday, MIDF Research said, the IPI growth matched with market expectations and slightly above its forecast.
The moderating growth pace is mainly due to general election factors, such as business uncertainties and extra holidays amid of the election, it said.
Moving forward, the research house foresees IPI performances to expand at steady pace of 3.5 percent to 4.5 percent for the second half, supported by robust external trade performance and gradual increase in commodity price which is expected to boost up industrial activity in Malaysia.
Lower business cost partly due to moderating inflation, stable retail fuel prices and tax-holiday will also provide additional boost for industrial production growth to hit 4.3 percent in full year, it said.
