Retail Savings and Investments in Malaysia - Coronavirus (COVID-19) Sector Impact

Retail Savings and Investments in Malaysia - Coronavirus (COVID-19) Sector Impact

Summary

The Coronavirus (SARS-CoV-2) outbreak, dubbed COVID-19, is first and foremost a human tragedy, affecting millions of people globally. The contagious Coronavirus, which broke out at the close of 2019, has led to a medical emergency across the world, with the World Health Organization officially declaring the novel Coronavirus a pandemic on March 11, 2020.

Fears surrounding the impact of COVID-19 have already significantly impacted the global economy, with most of the countries across the world registering declines in their economic growth for the year to date. Many economists and institutions have cut their forecasts as a number of countries officially slipped into recession in Q1 2020.

Malaysia’s GDP has been revised downward for 2020 due to the economic disruption caused by Coronavirus. With the government now easing lockdown restrictions and allowing businesses to reopen in a phased manner, a rise in consumer and commercial spending is expected, which in turn will support the retail savings and investments industry.

This report focuses on the impact of the coronavirus outbreak on the Malaysian economy and the country’s retail savings and investment market. It also highlights the measures adopted by the government to combat COVID-19. Based on our proprietary datasets, the snap shot contrasts the publisher's pre-COVID-19 forecasts and revised forecasts of total retail bond, deposits, equities and mutual funds holdings in terms of value and growth rates. It also analyses the effects on HNW wealth, examining the importance of different industries as a contributor to HNW wealth.

Scope

• Malaysian retail savings and investments are forecast to contract by 0.7% over the course of 2020 as the economy has come to a standstill thanks to the impact of COVID-19. Although the country’s flagship index bounced back on the back of eased lockdown restrictions, uncertainties regarding the ongoing loss of productivity and a resurgence in COVID-19 cases are expected to weigh down demand for investments in risk assets throughout the year. Retail equity and mutual fund holdings are expected to take the brunt of the economy’s slowdown, with respective declines of 18.6% and 7.4% anticipated.
• Retail deposits holdings, on the other hand, have fared better than initially expected as deposits increased by 2.8% in May compared to April 2020. However, more pronounced declines in risk asset holdings mean the total retail holdings forecast for 2020 is 3.1 percentage points lower than before the onset of COVID-19.
• The effects on the different segments that make up the HNW market will be disproportionate. The basic materials sector is expected to take a significant hit thanks to falling prices and lower demand globally as COVID-19 is taking a toll on global production levels. Likewise, COVID-19 has adversely impacted the real estate sector, causing a dip in demand for house buying and a halt in construction activities. However, government relief measures are expected to spur demand in the coming months.
• On the flipside, the fast-moving consumer goods industry is set to benefit from COVID-19 as demand for staples, toiletries, and over-the-counter drugs remains high.

Reasons to Buy

• Make strategic decisions using top-level revised forecast data on the Malaysian retail savings and investments industry.
• Understand the key market trends, challenges, and opportunities in the Malaysian retail savings and investments industry.
• Receive a comprehensive insight into the retail liquid asset holdings in Malaysia, including deposits, mutual funds, equities, and bonds.