Consumer Sector - Resilient, Though Slowing Growth Trend Envisaged In The 2H - 1/7/2010

Slower increase in consumer spending outlook. RHBRI’s economics team envisages consumer spending to grow at a slower pace of 4.6% yoy in the 2H vs. +5.4% yoy in the 1H. For the full-year, however, consumer spending will likely bounce back to +5.0% in 2010 (from +0.7% in 2009). Nevertheless, there is still a risk in our consumer spending projections, arising from the uncertainty in government policies, especially on the cut in consumer subsidy. We believe this uncertainty could further dampen consumer spending particularly on big-ticket items, until clearer implementation strategies are in place. We expect retailers and MLM players to be most affected by the removal in subsidy, while healthcare and F&B sectors would be least affected.

Consumer Sector - Resilient, Though Slowing Growth Trend Envisaged In The 2H - 1/7/2010