Malaysia: Inflation edges down in March
April 18, 2018
Consumer prices fell 0.33% from the previous month in March, following a flat print in February. The decrease reflected lower prices for transport, and food and non-alcoholic beverages, which were partially offset by higher prices for restaurant and hotels.
Inflation ticked down in March to 1.3% from 1.4% in February. An annual drop in transport costs, stemming from a base effect caused by higher fuel prices last year, drove inflation down to its lowest level in over a year and a half. In addition, communication and clothing and footwear prices were down in annual terms, while food inflation moderated from the previous month in March. Inflation is widely expected to regain some traction in April onwards on a base effect from fuel price cuts in April 2017.
Core inflation, which excludes volatile products such as fresh foods and fuel, also eased in March, falling to 1.7% from 1.8% in February. Core pressures should also mount in the months to come on a relatively loose monetary stance and robust domestic growth.
Malaysia Inflation Forecast
FocusEconomics Consensus Forecast panelists expect inflation to average 3.0% in 2018, which is unchanged from last month’s projection. For 2019, the panel sees inflation averaging 2.8%.
Author: Lindsey Ice, Economist