Wednesday, June 12

MIDF Research Forecasts Malaysia’s Economic Growth Driven by Affirmative Policies and China’s Recovery in 2024

MIDF Research predicts Malaysia’s economic expansion in 2024, attributing the anticipated growth to various factors, including the revival of international trade, affirmative government policies, and China’s ongoing economic recovery. Additionally, the potential halt in rate hikes by the US Federal Reserve contributes to this optimistic outlook, according to the research firm.

Imran Yassin Md Yusof, Head of Research at MIDF, highlighted the significance of government initiatives like the National Energy Transition Roadmap (NETR) and the 12th Malaysia Plan in bolstering the economy. He emphasized that positive trends in the job market, income growth, and the gradual recovery of the tourism sector would also stimulate domestic spending.

“While these drivers suggest a relatively smooth trajectory for the economy, potential downsides exist, including the prospect of a US economic recession and geopolitical tensions, notably the escalating conflicts in the Middle East and forthcoming general elections in multiple countries, including the US presidential election,” Imran stated during MIDF’s 2024 market outlook presentation’s media briefing.

MIDF Research projects Malaysia’s Gross Domestic Product (GDP) to grow by 4.7% in 2024, driven primarily by resilient domestic demand.

However, the research firm highlighted global economic growth expectations of 2.9% in 2024, falling below the 2010-2019 average of 3.8% growth. Potential risks to global growth encompass central banks’ tightening policies to curb inflation, leading to economic cooling, geopolitical uncertainties, and market fluctuations affecting various nations differently.

Imran underscored that while global production activities may recover, consumer spending will be crucial for sustained growth, aided by easing inflation, robust labor markets, and rising incomes. For trading nations, growth prospects may improve in 2024, benefiting from global production and trade recovery but potentially restrained by anticipated slowdowns in demand from advanced economies.

The forecast also predicts stable commodity prices, with expectations of crude palm oil averaging RM3,600 per tonne and Brent oil prices averaging US$84 (RM392.74) per barrel in the upcoming year.

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