Malaysia’s economy seen expanding at slower rate
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Malaysian economy is anticipated to expand at a slower rate in the next four to six months ahead, based on the findings of Malaysian Economic Indicators: Leading, Coincident & Lagging Indexes for May 2018.
The Leading Index (LI) indicators are designed to observe the economic performance in the short term.
The Statistics Department said in a statement that the monthly change of LI showed a negative growth of 1.1% to 117.8 points in May 2018 from 119.1 points in April 2018, mainly due to the 0.5% decrease in the number of new companies registered.
It said the annual change of LI also registered a decrease of 0.7% in the same month against 1.4% in April 2018.
However, the Coincident Index (CI), which reflects the current economic activity, improved in May 2018, registering a growth of 0.3% in the reference month.
“The annual change of CI rose 2.2% in May 2018. The Diffusion Index for CI remained at 66.7% since January 2018. Nevertheless, the level of Diffusion Index for LI was below 50% (14.3%),” it added.
Questions & Answers
Q.What is the primary reason for the Leading Index's negative growth in May 2018?
What is the primary reason for the Leading Index's negative growth in May 2018?
The negative growth in the Leading Index was mainly due to a 0.5% decrease in the number of new companies registered. This decline suggests a potential slowdown in future economic activity.
Q.How did the Coincident Index perform in May 2018, compared to the Leading Index?
How did the Coincident Index perform in May 2018, compared to the Leading Index?
While the Leading Index showed negative growth, the Coincident Index, reflecting current economic activity, improved by 0.3% in May 2018. Its annual change also rose by 2.2%.
Q.What is the purpose of the Leading Index indicators mentioned in the report?
What is the purpose of the Leading Index indicators mentioned in the report?
The Leading Index indicators are specifically designed to observe and forecast economic performance in the short term. They provide insights into potential changes in the economy over the coming months.