KUALA LUMPUR, July 10 (Bernama) -- A resilient domestic demand coupled with the recovery in exports will likely lift the country's real gross domestic product (GDP) growth, albeit moderately, to 5.4 per cent year-on-year in the second quarter of this year after surging 6.2 per cent in the first quarter says RHB Research Institute.
Earlier today, the Statistics Department revealed that Malaysia's Industrial Production Index (IPI) increased by 6.0 per cent in May 2014 from the same month last year.
RHB Research Institute said in its "Economic Highlights" today that the stronger growth in industrial activities in May 2014, suggests economic activities remained resilient, on account of a strong improvement in the country's exports amidst sustained recovery in the developed economies, aided by sustained increase in domestic demand.
The industrial production increase was reflected in a pick-up in manufacturing and electricity output, but was offset partially by a slowdown in production from the mining sector during the month.
"Although domestic demand will likely moderate in the second half, dampened by slowing government spending due to fiscal consolidation drive and curbs on the property market, it will likely remain resilient and act as the main anchor of growth during the year.
"We expect consumer spending to hold up and private investment to remain relatively strong in the second half amid elevated price pressure," it added.