KUALA LUMPUR, July 17 (Bernama) -- Standard Chartered (Stanchart) has maintained Malaysia's gross domestic product (GDP) growth for 2024 at 4.8 per cent, aligned with Bank Negara Malaysia's projection of four to five per cent.
Its head of Managed Investments and Advisory, Malaysia, Ng Shin Seong said this projection, however, has not taken into consideration the future measures on subsidy rationalisation.
"On the fuel subsidy (diesel), we think it is a very targeted approach and the people that needs help will get some help back.
"The subsidy rationalisation (on diesel) will help the government's fiscal position and we think it is an upside for the country," he told reporters at its Global Market Outlook Second Half (2H) 2024: Adapting to Shifting Winds media conference here today.
Meanwhile on the ringgit, Ng said Stanchart is forecasting the ringgit to strengthen to 4.66 level against the US dollar by year-end, backed by the expectation of one to two interest rate cuts in the United States (US).
"We also expect the ringgit to marginally appreciate next year, as we believe the US Federal Reserve (Fed) will continue with its interest rate cuts," said Ng.
He further said that investors should take note of the shifting winds in Malaysia, as the investment outlook in the country has improved with the FBM KLCI notching a 12.7 per cent rise year-to-date.
"Malaysia attracted record approved investments in 2023 and is emerging as a data centre powerhouse in Southeast Asia.
"Structural reform which includes targeted subsidy rationalisation and the pursue of sustainable growth under major plans such as the New Industrial Master Plan 2030, National Energy Transition Roadmap and the National Semiconductor Strategy will likely draw quality investments,” he said.
Last year, Stanchart launched its Signature CIO Funds consisting of four globally diversified multi-asset funds designed to provide retail investors with access to the bank’s chief investment office (CIO) views.
Since then, the series of foundation portfolios catering to different risks and income profiles have raised close to RM1 billion.
On the global front, Stanchart’s head of asset allocation Audrey Goh said the start of major central bank interest rate cuts marked a key turning point for investors as policymakers switch their focus towards supporting growth.
She said the bank sees this as a good time to adapt the shifting winds by staying overweight on equities over bonds and cash; favouring US equities globally and India equities in Asia; and owning gold and emerging markets (EM) US dollar bonds as diversifiers.
"We continue to favour growth sectors in the US focused on the technology and communication service sectors, and in Europe, the strategy is consistent with the improvement in the growth outlook; we are overweight on the technology and healthcare sectors.
"In China, we favour select government policy beneficiaries and is overweight on the technology, communication services and consumer discretionary sectors," Goh added.
-- BERNAMA
