Thanks to these robust figures.
According to Nomura, IP rose by a better-than-expected 7.5% y-o-y in November from an upwardly revised 6.4% in October (Consensus & Nomura: 5.9%). The improvement in IP was broad-based, with manufacturing IP up 7.6% y-o-y from 6.6% in October and mining IP rose 7.5% from 6.1%.
Meanwhile, export growth was also better than expected in November but improved to a lesser extent. Exports rose 3.3%y-o-y after contracting 3.2% on account of higher electronics exports (+1.1% y-o-y in November from -1.1% in October).
Exports of key commodities such as palm oil (-2.1% from -17.6% in October), crude oil (-2.8% from -10.6% in October) and LNG (-7.7% from -15.9%) improved in November, but nonetheless remained weak. In terms of destination, exports to the US remained surprisingly resilient while exports to China, Korea and Thailand increased.
Here's more from Nomura:
This divergence between IP and exports is a trend we have noted over the past year in Malaysia. We think this divergence is a result of strong domestic demand, which has been supported by expansionary fiscal policy over the past few years ahead of the general elections (which in our base case are likely to be held this March and at latest need to be held by June 2013).
Consistent with this, import growth has remained resilient, rising 4.3% y-o-y in November from 5.7% in October. In terms of GDP, the data suggest that growth in Q4 2012 will be higher than our current forecast of 5.1%.
Our current tracking suggests GDP growth could be as strong as 5.6% y-o-y which should take full-year 2012 GDP growth to 5.4% versus our current estimate of 5.3%
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