Bullish Performance Shows Malaysia On V-Shaped Recovery Track

By Nurul Jannah Kamaruddin KUALA LUMPUR, Dec 17 (Bernama) -- Malaysia is poised for a V-shaped recovery as seen in the bullish performance of the domestic equity market, ringgit, and some economic data amid improved business as well investor confidence. Inter-Pacific Asset Management Sdn Bhd chief executive officer Dr Nazri Khan Adam Khan said a full recovery is on the way soon for Malaysia as the economy is picking up in a V-shape after two consecutive quarters of contraction in the gross domestic product (GDP). Malaysia recorded a GDP of 0.7 per cent in the first quarter (Q1) of 2020. Due to the COVID-19 pandemic, the economy contracted by 17.1 per cent in Q2 and the fall slowed to -2.7 per cent in Q3. Nazri Khan sees the GDP contracting to 4.0 per cent this year and rebounding to a growth of 5.0 per cent in the Q1 2021. Overall, 2021 will see a growth of 6.0 per cent, he told Bernama. In addition, he anticipates Budget 2021 to put the Malaysian economy in a stronger position. The budget, the first by the Perikatan Nasional government, was passed in the Dewan Rakyat on Dec 15, when the Supply Bill 2021 (Budget 2021) received the majority support of members of parliament. The Bill was passed by an en bloc vote after its third reading by Finance Minister Tengku Zafrul Abdul Aziz. “Despite Fitch Ratings’ recent downgrading, we should have a clearer sky next year. But if S&P and Moody’s follow suit, maybe we will see a negative impact but so far from the indications, we do not see it yet or otherwise, they must have warned us. “Fitch Ratings’ downgrading was expected as they already gave us a warning,” he said, adding that bullish corporate earnings outlook indicate bullish economic and market outlooks, going forward. Fitch Ratings recently downgraded Malaysia's Long-Term Foreign-Currency Issuer Default Rating to 'BBB+' from 'A-'. The outlook is stable. -- BERNAMA