Malaysia’s industrial production beats bearish expectations with 5.1% growth in September

Manufacturing is staging a comeback.

Malaysia's overall industrial production index grew a stronger +5.1% yoy in September, surprising on the upside, against expectations for +3% growth, according to a report by Bank of America Merrill Lynch.

September IP was led by manufacturing, which grew at a quicker pace of +5.6%, compared to +4.3% in August.

Manufacturing output was in turn supported by electrical & electronic products (+12%), and petroleum, chemical, rubber & plastic products (+3.5%). 

Mining reversed from a contraction in August to a growth of +4.4% in Sep, as crude oil output rose a strong +11.8%, offsetting a 3.8% decline in natural gas output.

“Manufacturing production has been surprisingly resilient, despite signs of a global slowdown. We highlighted in previous reports the slowdown in Nikkei PMI, intermediate goods imports, and worsening employment metrics. Contrary to what these data suggests, manufacturing output grew a stronger +4.7% (average) in 3Q vs. +4.1% in 2Q, though still slower compared to the growth rates over 1Q2014-1Q2015,” said BofAML.