Malaysia Inflation February 2021


Malaysia: Inflation rises for the first time in one year in February

March 24, 2021

Consumer prices rose a seasonally-adjusted 0.33% in February over the previous month, below the 1.24% rise recorded in January. The moderation was largely due to softer price increases for housing and utilities, and transportation.

Inflation came in at 0.1% in February, contrasting January’s 0.2% drop in consumer prices and putting an end to an 11-month streak of falling prices. Meanwhile, the trend pointed down slightly, with the annual average variation of consumer prices coming in at minus 1.4% in February (January: -1.3%).

Commenting on the inflation outlook ahead, Julia Goh and Loke Siew Ting, economists at UOB, noted:

“The full-year inflation reading is expected to average higher at a positive rate of 3.0% this year. This comes as the economy is expected to recover further following the roll-out of vaccines and additional policy support, higher global commodity prices, and year-ago low base effects. […] Despite higher inflation outlook this year, we expect muted underlying demand price pressures amid elevated unemployment rates to keep Bank Negara Malaysia (BNM)’s monetary policy stance in neutral mode.”

FocusEconomics Consensus Forecast panelists expect inflation to average 2% in 2021, which is up 0.2 percentage points from last month’s forecast, and 2% in 2022.


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Malaysia Inflation Chart

Malaysia Inflation February 2021 0

Note: Year-on-year and month-on-month variation of consumer price index in %.
Source: Department of Statistics Malaysia (DSM).

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