Malaysia: Inflation moderates in August

Consumer prices increased 0.17% month-on-month in August, matching July’s print. The figure reflected higher prices for housing, water, electricity, gas and other fuels; transport; and recreation services and culture.

Inflation eased to 0.2% in August from July’s 0.9%. Annual average inflation came in at 2.1%, down from July’s 2.4% reading, while core prices—which exclude certain types of fresh food and administered prices of goods and services—fell 0.2% in August on an annual basis, matching July’s print.

Malaysia Inflation Forecast

FocusEconomics Consensus Forecast panelists expect inflation to average 1.4% 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 2.2%, down 0.1 percentage points from last month’s forecast.