RM100 Cash Aid To Have RM3 Bln Retail Injection, Boost Consumption
By Siti Radziah Hamzah
KUALA LUMPUR, July 24 (Bernama) -- The targeted fiscal measures announced by Prime Minister Datuk Seri Anwar Ibrahim on Wednesday are anticipated to enhance near-term consumption, especially for essential goods and household items, according to Kenanga Investment Bank Bhd (Kenanga IB).
In its research note, Kenanga IB said among the fiscal measures, the one-off RM100 cash aid to every Malaysian citizen aged 18 and above, which would be disbursed on an individual basis rather than per household, was widening the consumption impact.
'We maintain a neutral stance on the consumer sector following the government's surprise RM100 cash aid announcement under the Basic Rahmah Contribution (SARA) programme, which marks the first cash aid for all adult citizens in Malaysia and could temporarily boost near-term spending ahead of the year-end festive season,' it added.
While the scale is smaller than previous stimulus rounds, Kenanga IB noted that mass-market retailers such as MR DIY, AEON, and Padini might see a modest uplift, supported by seasonal momentum and improved sentiment.
It added that additional cost-of-living measures, including a 3.0 per cent cut in the RON95 fuel price, toll hike suspension, and an expanded Jualan Rahmah MADANI programme, would further ease pressure on consumers.
'All in, we estimate about RM3 billion retail injection, comprising RM2.2 billion from the new RM100 cash aid, RM300 million from Rahmah MADANI sales and RM500 million in toll savings,' Kenanga IB said.
The investment bank noted that although the RM100 aid was restricted to essential items, the increase in disposable income might still lead to spillover spending and consumers were likely to reallocate some of their usual budget toward discretionary purchases.
'The impact is likely to be more meaningful for the B40 group, where RM100 represents about 4.0 per cent of monthly household disposable income, compared to 2.0 per cent for M40 and 1.0 per cent for T20,' it added.
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