Business

Editor: Bruce Meng
9 Sep 2008 08:54:21 GMT

* What: Malaysia July Industrial Output

* When: Thursday, Sept 11 at 12:01 p.m (0401 GMT)

* Rising from 10-month low in June

KUALA LUMPUR, Sept 9 - Malaysian annual industrial production growth is expected to have picked up to 2.4 percent in July from June when it registered a 10-month low of just 2 percent, a Reuters poll shows.

Growth in the industrial production index, which measures manufacturing, mining and electricity output, has come off the boil as the global economy has slowed and demand for Malaysian exports, especially electronics, has diminished.

Manufacturing accounts for two-thirds of the index.

But there may be room for an upside surprise after export data for July, released last week, rose more than expected as falls in commodity prices, primarily palm oil and crude oil, did not show as much of a decline as forecast and volumes in palm oil were higher than predicted.

Exports <MYEXP=ECI> rose 25.4 percent year-on-year, well above the 15.8 percent forecast in a Reuters poll.

"While we continue to see weak electronic demand a thorn in the sector’s growth, especially given the importance of the electronics sector to Malaysia’s exports, the easing of commodity prices could mean the start of the erosion of commodity-related manufactures’ support for the manufacturing expansion," said Alvin Liew of Standard Chartered.

Forecasts for Malaysia July industrial output

Bank Islam 1.9

CIMB 1.0

Forecast 2.3

IDEAglobal.com 3.2

ING 2.5/2.6

JPMorgan 2.7

Kenanga 1.5

RHB 2.6

HSBC 3.0

Standard Chartered 0.1

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Median 2.4 *To see historical data on Malaysia’s industrial output, 3000Xtra clients can click on <MYIP=ECI>, right-click in the quote window and select graph from the menu.