Consumer spending in Malaysia to increase 5.8% in 2017

It will grow at an annual average of 5.3% between 2017-2021. BMI Research reported that consumer spending in Malaysia is set to increase. The rise will be brought about the increasing disposable income. Real household spending growth in Malaysia will continue to expand the medium term.

However, it will be modest on the back of an uptick in inflation and slightly weaker currency. Household spending will become more dynamic over the medium term as the share of non-essential spending rises. BMI foresees household spending real to grow at an annual average of 5.3% between 2017-2021. In 2017 we project a y-o-y increase of 5.8%

Rising disposable incomes will foster discretionary spending, highlighted by robust growth in education; restaurants and hotels; and recreation and culture spending. According to BMI, these categories are set to grow at an annual average rate of 8.7%, 8.5% and 8.2% respectively.

Consumer spending in Malaysia will benefit from a youthful and increasingly urbanised population; rising household incomes; and low levels of unemployment. The growing middle class and relatively low inflation will help generate demand for non-essential items and luxury goods.