By Ranjit Singh
MALAYSIA'S economic growth is expected to cool next year on the back of weaker consumer spending, says Bank Islam Bhd chief economist Mohd Afzanizam Abdul Rashid.
“We project the economy to grow at 4.3% in 2020 as we believe that consumer spending will ease next year," Afzanizam said when presenting the bank’s 2020 outlook. His GDP projections are 0.5 point lower than the government’s forecast of 4.8% next year.
Consumer spending may have been tipped to grow 7.3% this year but a slowdown is expected next year to 6.5%, he added.
On the stock exchange, Afzanizam is predicting the FBM KLCI to reach 1,650 points next year. The market barometer is expected to hit 1,600 points by the end of this year.
He added that, in the face of external headwinds that would continue to affect Malaysia next year, especially the trade impasse between the US and China, Bank Negara Malaysia might implement a 25-basis-point cut to its Overnight Policy Rate next year.
The government is also expected to spend on big-ticket items in the vein of the East Coast Rail Link project to spur the economy, Afzanizam said.