Malaysia export growth to dip 4%

Consequently overall trade surplus will plateau to MYR 8.8b.

According to DBS, trade data for July is on tap tomorrow. Headline export growth is expected to register 4.0% YoY, down from 5.4% in the previous month as external headwinds continue to weigh down on export performance.

Here's more from DBS:

Import is likely to record an increase of 6.1%, up from 3.6% previously, due to resilient domestic consumption and strong investment demand. Overall trade surplus should moderate to MYR 8.8bn, from MYR 9.2bn.

Essentially, the story for Malaysia has not changed much from six months ago. Export performance is expected to remain sluggish, weighed down by the dire economic conditions in the Eurozone as well as the US.

Slowdown in China is also having an effect on export sales. Overall exports and industrial production will remain lacklustre in the coming months. Yet, despite the drag from the external front, the economy continues to post healthy GDP growth (5.4% in 2Q12) on the back of a buoyant domestic growth.