Page 28 - SC SCAR 2023 ENGLISH Flipbook

PART 1 CAPITAL MARKET REVIEW AND OUTLOOK
OUTLOOK FOR 2024
Global economic growth is expected to remain tepid in 2024 amid heightened economic uncertainties. The IMF in its October WEO forecasted global growth to ease to 2.9% in 2024 from an estimated 3.0% expansion in 2023. Nonetheless, economic growth in the ASEAN-54 region is projected to accelerate to 4.5% in 2024 from 4.2% in 2023, which may elevate business sentiment and investment interest in the region. On the monetary front, the gradual moderation in global inflationary pressure led to a reassessment of monetary policy expectations from a prolonged period of high global interest rates to anticipation about the timing of the easing cycle. This, coupled with ongoing geopolitical fragmentation, will be key determinants of the pace of global economic recovery. Meanwhile, developments in the global capital market are expected to be in tandem with the economic outlook.
The Malaysian economy is projected to remain on a steady growth trajectory in 2024, backed by firm domestic demand, primarily through continued expansion in private sector spending. The Ministry of Finance expects growth of the Malaysian economy to accelerate to 4-5% in 2024 from 3.7% in 2023. However, risks to growth remain tilted to the downside given ongoing external challenges.
In the domestic capital market, activity will continue to be influenced by momentum in the domestic economy and corporate developments, with volatility likely to be driven primarily by uncertainties surrounding the global economy, particularly the direction of global monetary policy and evolving geopolitical tensions. Nevertheless, favourable momentum in the latter part of 2023 is expected to continue into 2024, underpinned by ongoing supportive policy actions under the Ekonomi MADANI framework, which includes the New Industrial Master Plan (NIMP) 2030 and the National Energy Transition Roadmap (NETR). These national policies are expected to provide a tailwind in the short- to medium- term, amid greater policy clarity and a continued commitment by the government towards improving medium-term economic growth prospects. Market expectations remained broadly positive, projecting the benchmark FBMKLCI to end 2024 at around 1,600 points. Meanwhile, the domestic capital market is expected to remain orderly and will continue to play an integral role in supporting the economy, underpinned by firm macroeconomic fundamentals, ample domestic liquidity and a facilitative capital market framework.
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SECURITIES COMMISSION MALAYSIA ANNUAL REPORT 2023
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ASEAN-5 refers to Malaysia, Indonesia, Singapore, Thailand, and the Philippines.