Malaysia: Inflation edges up in July

Consumer prices increased 0.17% month-on-month in July, contrasting June’s 1.24% drop. The print reflected higher prices for food and non-alcoholic beverages; housing, water, electricity, gas and other fuels; recreation services and culture; and education.

Inflation edged up to 0.9% in July from June’s 0.8%. Annual average inflation came in at 2.4%, down from June’s 2.6%, while core inflation—which excludes certain types of fresh food and administered prices of goods and services—fell 0.2% in July, contrasting June’s 0.1% increase.

Malaysia Inflation Forecast

FocusEconomics Consensus Forecast panelists expect inflation to average 1.7% in 2018, down 0.3 percentage points from the previous month’s projection. This downward revision reflects the new government’s decision to reduce the Goods and Services Tax (GST) to 0% effective 1 June. For 2019, the panel sees inflation averaging 2.3%.