Malaysia: Consumer prices drop again in annual terms in December
January 22, 2021
Consumer prices rose 0.50% on a seasonally-adjusted basis over the previous month in December, contrasting November’s 0.17% decline. December’s upturn was largely attributed to rebounding prices for transport, and food and non-alcoholic beverages.
Meanwhile, consumer prices declined 1.4% year-on-year in December, following November’s 1.7% drop. Lastly, the annual average variation of consumer prices came in at minus 1.1% in December, below November minus 0.9%.
Commenting on the inflation outlook, Julia Goh and Loke Siew Ting, economists at UOB said:
“For the full year, headline inflation averaged at -1.2% in 2020, which was also in line with our projection of -1.1% and official forecast of -1.0%. We expect inflation to return to positive territory by 1Q21 and to average higher at 2.1% for the entire year of 2021 (official forecast: +2.5%). This is mainly based on the assumption of economic recovery post containment measures and inoculation, firmer global oil prices, and favourable statistical comparison base effects.”