KUALA LUMPUR, Aug 8 (Bernama) -- MIDF Amanah Investment Bank Bhd expects consumer demand to maintain its expansionary trajectory in the second half of 2024 (2H 2024).
In a note today, MIDF Amanah stated that it foresees the robust consumer demand to continue in 2H 2024, supported by a stable job market, increased tourism activity, and supportive economic policies.
“Nonetheless, potential downside risks persist, notably elevated inflation expectations and subdued consumer sentiment,” it said.
In a report today, the Department of Statistics Malaysia (DoSM) said Malaysia’s wholesale and retail trade grew 5.4 per cent year-on-year (y-o-y) in June 2024, to register sales of RM146.0 billion, driven by the retail trade sub-sector, which rose 7.9 per cent to record sales of RM64.1 billion.
MIDF Amanah also noted that growth in motor vehicle sales, however, moderated sharply to 2.0 per cent y-o-y, while wholesale trade advanced further by 4.0 per cent y-o-y,
“The softer growth in vehicle sales in June 2024 might be due to the implementation of diesel subsidy rationalisation which affected commercial vehicle sales.
“The sustained expansion in consumer demand was aligned with the healthy labour market conditions and stable inflation, as price pressures, in general, remained under control despite the implementation of diesel subsidy rationalisation in June 2024,” it added.
Meanwhile, MIDF Amanah maintains its retail trade forecast at 5.0 per cent for 2024.
As of the first half of 2024, Malaysia’s distributive trade sales increased by 5.9 per cent from 7.7 per cent in 2023, while sales of motor vehicles and retail trade improved by 7.5 per cent (2023: +12.3 per cent) and 6.3 per cent (2023: +9.0 per cent), respectively.
Meanwhile, wholesale trade rose by 4.7 per cent (2023: +5.2 per cent).
“The steady momentum of domestic demand is expected to continue in 2024, underpinned by a resilient labour market, positive real wage growth, a better pick-up in tourism activities, and supportive economic policies.
“However, upward inflationary pressure may affect consumer demand, contingent on the potential effects of targeted fuel subsidy approaches and fluctuations in global commodity prices,” said MIDF Amanah.
-- BERNAMA
