Welcome to Malaysians on Malaysia: our quarterly report on Malaysian sentiments, featuring essential insights into consumer confidence, media trust, behavioural, tech and esports trends in Malaysia.
Coming into the second quarter of 2019, our Malaysians on Malaysia study is set to understand the trends and sentiments that have been displayed during the first half of 2019.
Since 2018, this study has steadily reported on insights and sentiments amongst Malaysians, and at the end of the first half of 2019, we are seeing a high index score, with sentiments across all indicators being very positive.
Despite the ongoing trade war and economic uncertainties, Malaysians’ outlook of the current and future state of our economy have improved tremendously, with people also being more relaxed when it comes to spending on major purchases despite previously remaining flat.
In this round, we continue to cover interesting topics like tech trends, e-wallet usage, esports and other interesting stats.
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For our Malaysia Confidence Index (MYCI), the overall index is at its highest point since GE 14. Malaysians have generally had positive sentiments that is consistent with the index staying above the 100-point mark, but with this increase, it’s a sign of things and expectations would be even better in the near future.
With the Malaysian economy expanding by 4.5% in 1Q2019, this signals an assurance amongst Malaysians which has manifested as high confidence levels throughout all areas studied in this quarter.
We have also had other significant events such as the increase of the total stock of foreign direct investment (FDI) by 10.3%, and the rise in Malaysia’s economy by 4.9% as reported by Bank Negara.
Therefore, if the economy and market growth continuously show signs of improvement despite the volatility caused by the US-China trade war, it will inadvertently improve overall confidence levels. We look forward to seeing the trend continue in the next two quarters for the rest of 2019.
These are the studied areas that make up the overall index. As seen here, we see lifts in scores across all components in 2Q2019.
Evidently, the confidence in the current state of economy and the state of economy for the next 12 months have both rebounded after previous waves showing a dip in scores.
The result tells us that perhaps Malaysians are more resilient and have adapted to the change in external factors such as the trade wars, the volatility of the Ringgit and the overall global market shifts.
At the same time, the index on major purchases is showing a healthy uptrend which indicates that people have become more willing to spend. Will the number finally inch past the 100-pt threshold in the next quarter? Stay with us till the next report to find out.
Jumping a strong 20-pts this wave, we see that the optimism of Malaysians continues to increase steadily over time since 3Q2018. This suggests that people feel they are increasingly making better financial decisions and are now in a better place, coupled with the government’s effort to create a financially prudent and savvy society.
The steady growth is reflected amongst all income brackets, especially strong within the middle-income group.
In 1Q2019, people from JB and Kuantan were the driving forces for positivity, however this time around, the Klang Valley (together with Penang) is showing better signs of optimistic improvement.
Subsequently, the index for the confidence level regarding financial well-being in the next 12 months has also grown by 13-pts, peaking since GE14.
Whilst the outlook amongst all of the income brackets is showing improvement, those in the middle income bracket recorded the highest increase in scores, followed by the lower income bracket. In recent times, there are efforts from the government’s in extending the loan repayment period, with a financing rate of up to 3.5% per annum.
After having two waves of indices holding flat, this wave’s index for spending on major purchases has gone up by 9-pts which indicates that people have loosened up their purse-strings and are more open to spending on major purchases.
The middle income and more affluent groups are still optimistic partially because of the down payment support, exemption from stamp duty fees and free financial education by Agensi Kaunseling & Pengurusan Kredit (AKPK) to help homebuyers understand the financial implications involved in buying a home.
Meanwhile, the PMEB group shows a rebounded score exceeding the 100-pts mark this wave, therefore, both groups are seen to be more willing to spend now.
Malaysians’ overall sentiment for the current state of the economy is at its highest as the government has been very vocal regarding the prospect of a sustainable GDP growth in 2Q2019 as well as continuing to prioritise economic growth.
As the economic growth for 2Q2019 is set to be healthy and driven by the on-going development mega projects, people from Klang Valley specifically are more enthusiastic with their sentiment perhaps attributed by the revival of ECRL, as well as the Klang Valley MRT 2 and LRT 3 project that would affect the long-term economic growth.
Both the PMEB and Non-PMEB groups are seen to have improved their optimism towards the current state of economy, as Malaysia has outperformed most of the ASEAN countries who have recorded a slowdown in 2Q2019 despite the intensifying China-US dispute.
Sentiments of where the Malaysian economy is headed over the next 12 months have recovered above the 100-pt mark this wave, which jives with the positive sentiments towards the current state of the economy. The Malaysian market continues to show resilience despite a weaker broader market environment.
Both PMEBs and Non-PMEBs are equally optimistic as even though there are periods of on-going volatility, the government’s priority towards economic growth and consideration to expand the budget to ensure the people’s economic well-being are well-received amongst Malaysians. The effect is thus seen especially with higher optimism among the lower income groups.
As for notable activities in 2Q2019, our most significant changes are seen in the categories of making payments through e-wallet and consuming food from convenience stores and petrol marts.
When it comes to eating out of home, we see a spike in people purchasing meals to takeaway from convenience stores/petrol marts this round, while much fewer people are stopping to have meals there compared to the previous quarter.
This quarter, the rate of e-wallet payments has returned to 22%, as it was 2 quarters ago. Looking back at the past year, we see a pattern of e-wallet payments rising and falling from quarter to quarter, suggesting that seasonal factors are a big influence on the usage of e-wallets.
We also note that there’s also been a slow-down in the flurry of new e-wallets entering the market of late.
Speaking of e-wallets, in this quarter, we continue to closely observe usage trends of the wide range of e-wallets available in Malaysia.
In 2Q2019, we find that the popularity of e-wallets has undergone a surge in the past few months, with popular e-wallets such as Boost, BigPay and Touch N’ Go experiencing significant boosts in usage, perhaps at the expense of lesser-used e-wallets.
Furthermore, the experimentation and trial levels continue to grow, as we see the average number of e-wallets used by each person continuing to increase from the previous average of 1 to 2 wallets used per person, to the current average of slightly over 3 e-wallets per person. This shows an ongoing growing acceptance by consumers in adoption of this mode of payment.
Looking at the different uses for e-wallets: Bill payments and tickets have seen the largest increase among the different usage occasions, with bill payments catching up to F&B which was previously the most prominent use for e-wallets.
Looking at our usual tech trends, Blockchain and Fintech both see a positive resurgence in awareness in this quarter – coinciding with the thawing of crypto-winter, while the esports industry appears to be steadily growing in awareness and becoming more mainstream.
Looking at cryptocurrency ownership, we see a healthy 36% increase in the ownership of cryptocurrency among Malaysians this quarter, with Bitcoin almost doubling in ownership amongst those that we studied. Since the beginning of 2019, Bitcoin has recovered from a low of US$3,400 and was comfortably sitting at almost US$11,000 (or 3X growth) by the end of 2Q2019. Other crypto-currencies has also followed suit in their recovery of value over this same period.
With positive sentiments across the board and high optimism across Malaysians of different socio-economic backgrounds, we are excited to see how the Malaysian economy and tech trends will develop as the year draws to a close.
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