ZCZC
BCN-37
MALAYSIA-ECONOMY-INFLATION
Malaysia’s August inflation growth falls to 42-month low
KUALA LUMPUR, Sept. 19, 2018 (BSS/Xinhua) – Malaysia’s consumer price
index (CPI) rose 0.2 percent year-on-year in August, the lowest rate in 42
months, due to the sharp fall of fuel prices, according to official data
released Wednesday.
The fuel prices have caused the index for transport to increase 2.1
percent as compared to 6.7 percent recorded in July, Malaysian statistics
department said in a statement,
Meanwhile, the overall index for food and non-alcoholic beverages which
accounted for 29.5 percent in the CPI of weights, increased 0.4 percent in
August.
The month also saw increases of prices in housing, water, electricity, gas
and other fuels of two percent, education of 1.1 percent, restaurants and
hotels of 0.7 percent, and food and non-alcoholic beverages of 0.4 percent.
On a monthly basis, CPI increased 0.2 percent as compared to July.
CPI for January-August registered an increase of 1.3 percent as compared
to the same period last year.
Meanwhile, core inflation decreased 0.2 percent in August, the same rate
as in the previous month.
ANZ Research said in a note Wednesday that the decline of CPI was driven
by the effects of the Goods and Services Tax (GST) removal from June, and
favourable base effects, especially in the transport component.
The research house expects the September CPI inflation print to show an
increase as the reintroduction of Sales and Service Tax will see some price
increases.
“The extent of the increase will depend on how quickly manufacturers and
service providers can implement the changes and how much of the tax is passed
on to consumers,” it said.
The research house sees inflation remaining benign through the rest of
2018 and well below 2 percent through the first half of 2019.
Given that the low inflation is transitory due to GST removal and base
effects, it also expects Malaysia’s central bank to keep the Overnight Policy
Rate (OPR) unchanged at 3.25 percent for a while.
BSS/XINHUA/HR/1355