- Global oil prices continued to climb further and recorded over USD70 per barrel in June 2021, which was higher than the pre-pandemic levels at circa USD60 per barrel in late 2019.
- Bank Negara Malaysia (BNM) projected the headline inflation to be between 2.5% and 4.0% for the entirety of 2021, driven by the higher global oil prices.
- The rollout of the National Covid-19 Immunisation Programme in February 2021 has continued to boost consumer sentiment, evidenced by the improvement in CSI in Q1 2021 that was nearing the 100-point optimism threshold. The government is targeting 80% of the population to be vaccinated by September to allow the resumption of all economic activities and keeping the nation on track towards higher economic growth.
- Nonetheless, the resurgence of Covid-19 cases, which further led to the Full Movement Control Order 3.0 (MCO 3.0) in June, is expected to impact private consumption temporarily.
- Whilst the central bank has yet to post any revision on the national GDP growth projection for 2021, the World Bank (in June 2021) lowered its projection to 4.5 per cent from 6.0 per cent estimated in March 2021.
- Nevertheless, we would expect that Malaysia continues to register positive growth this year, given the low base effect from last year.