KUALA LUMPUR: The global tech upcycle and front-loading activities are expected to bolster Malaysia’s trade performance in the fourth quarter of 2024 (4Q 2024), according to CIMB Securities Sdn Bhd. The firm indicated that Malaysia’s exports managed to recover, showing a growth of 1.6 percent year-on-year (y-o-y) in October 2024, although the figures fell short of market expectations as trade activities waned towards year-end.

According to BERNAMA News Agency, the research house observed that import growth further moderated to 2.6 percent y-o-y, with capital goods imports decreasing by 2.7 percent and intermediate goods imports growing at a slower pace. This imbalance contributed to a narrowing of Malaysia’s trade surplus by 6.2 percent month-on-month, resulting in a surplus of RM12 billion in October 2024.

In response to the weaker-than-expected external trade activity, CIMB Securities has revised its 2024 trade forecasts downward, adjusting export growth to 5.0 percent from an earlier projection of 8.0 pe
rcent, and import growth to 12.8 percent from 18.0 percent. Despite these revisions, the firm has maintained its 2024 gross domestic product (GDP) forecast at 5.2 percent, attributing this to robust investment activities.

Looking forward, the research house anticipates that both exports and imports will increase by 5.3 percent and 5.6 percent, respectively, in 2025, aligning with its GDP growth forecast of 5.0 percent for the year. However, CIMB Securities cautioned that potential risks remain, particularly disruptions to global trade stemming from policy uncertainties following the United States elections, which could intensify inflationary pressures and weaken global trade demand.