Malaysia’s export growth slowed sharply in January, according to figures published on Wednesday, with an increase of just 0.4 per cent, compared to a forecast figure of around 2 per cent.

But it’s not clear how much of this was caused by the weak European demand that is casting a shadow over Asia’s exporters and how much was due to the Lunar New Year holidays. Next month, we’ll know more.

Yeah Kim Leng, Kuala Lumpur-based chief economist at RAM Holdings, told Bloomberg that Europe was a significant factor. “The problems in Europe are casting some concerns over the outlook for export-oriented countries in Asia. In the short term, there will be a slowdown in the appreciation of Asian currencies.”

However, Barclays Capital said in a note that things aren’t as bad as they look in Malaysia once the one-off impact of the holiday is stripped out. It said in a report:

The weak export print mirrors other Asian economies, which have reported weak headline export growth due to the Lunar New Year holidays. We believe the weakness is temporary, and should reverse in February. …

…We believe the outlook for exports over the coming months is good. Intermediate imports, a useful indicator for exports, have held up. At the same time, momentum in capital goods has remained solid, on the back of the large pipeline of high-profile investment projects. This indicates that growth should remain on a solid footing in the coming quarters. We expect GDP growth of 5.0% in 2012.

But not everybody is so optimistic. Euben Paracuelles, Nomura’s south-east Asia economist, told beyondbrics on Tuesday that the region’s open export-oriented economies – including Malaysia – were vulnerable to the swings in global trade.

The latest indicators showed the US and European Union economies faring slightly better than feared a few months ago. But worries about China and about a spike in oil prices were increasing. “Signs of improvement in the US and Europe are likely to be offset by the effects of oil prices rising and China slowing,” Paracuelles said.

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