KUALA LUMPUR, May 3 ― Kenanga Investment Bank Bhd has maintained its forecast that Malaysia's gross domestic product (GDP) would grow at a faster rate of 4.5 per cent - 5.0 per cent in 2024 from 3.7 per cent last year, following an improved manufacturing performance in April.

The seasonally adjusted data released by S&P Global yesterday showed that Malaysia's manufacturing purchasing managers’ index (PMI) rose to 49.0 in April from 48.4 in March, suggesting an improved GDP growth.

"The improvement was due to a significant increase in external demand, marking the first improvement in 12 months,” Kenanga said in a note today.

Overall, the investment bank kept its GDP forecast for the first quarter of 2024 (1Q 2024) unchanged at 3.3 per cent versus three per cent in 4Q 2023, compared to the Department of Statistics’ (DoSM) advance estimate of 3.9 per cent.

"Growth is expected to accelerate in the second half of 2024 (2H 2024) due to the lower base effect recorded last year,” it said.

A PMI reading above 50 points indicates an expansion in the manufacturing sector while below 50 indicates a contraction.

Meanwhile, MIDF Amanah Investment Bank Bhd's research unit, MIDF Research has kept its forecast on Malaysia’s exports of goods to rebound by 5.2 per cent in 2024 from a contraction of eight per cent in 2023 following the better manufacturing data in April.

"Looking ahead, we foresee better pick-up of global trade activities as regional economies recorded improving manufacturing PMI figures.

"For instance, China registered 51.4 versus 51.1 in March 2024, the Philippines 52.2 (March 2024: 50.9), Vietnam 50.3 (March 2024: 49.9), Taiwan 50.2 (March 2024: 49.3) and Japan 49.6 (March 2024: 48.2),” it said in a separate note. ― Bernama