MALAYSIA’S leading index (LI) rebounded 2.2% year-on-year (y-o-y) to 111.2 points in May, up from a y-o-y contraction of 0.5% in April (110.8 points), indicating a positive economic outlook in the months to come, the Department of Statistics Malaysia (DOSM) said.

The LI is a predictive tool used to anticipate economic upturns and downturns in an average of four to six months ahead.

“The LI improved in May 2022 with the long-term trend index remaining above 100.0 points. However, it must be noted that efficient and effective inflation management by the government is crucial for sustainable economic growth,” DOSM said in a statement today.

Chief statistician Mohd Uzir Mahidin said the expansion of the LI was mainly due to the increment in real imports of other basic precious and other non-ferrous metals, driven by the encouraging demand for platinum-based imports. 

On a month-on-month (m-o-m) basis, he said, the LI grew 0.4% in May versus a contraction of 0.4% in April, mainly supported by growth in the number of housing units approved (+1.2%), real imports of other basic precious and other non-ferrous metals (+0.2%) and number of new companies registered (+0.1%).

Meanwhile, the coincident index (CI) – which reflects the current state of the economy – grew 6.4% y-o-y in May from 5.3% y-o-y in April.

On a monthly comparison basis, it said the CI increased 0.8% in May, mainly contributed by the volume index of retail trade, which grew 0.7% m-o-m. – July 25, 2022.