Malaysia: Inflation rises in February
Inflation came in at 1.8% in February, up from January’s 1.5%. February’s result marked the highest inflation rate since October 2023 and was partly due to the timing of the Lunar New Year in 2024. Looking at the details of the release, transportation prices rose at a quicker pace in February compared to the previous month, as did price pressures for housing and utilities.
Annual average inflation fell to 2.1% in February (January: 2.3%).
Finally, consumer prices increased a seasonally adjusted 0.53% from the previous month in February, accelerating from January’s 0.15% increase. February’s result marked the highest reading since June 2022.
United Overseas Bank analysts Julia Goh and Loke Siew Ting commented:
“For now, we maintain our 2024 full-year inflation forecast at 2.6% (BNM est: 2.0%–3.5%, 2023: 2.5%) which has not taken into account any fuel price adjustments as there is still a lack of implementation details of the proposed targeted subsidy mechanism. The size and timing of the implementation of subsidy rationalization particularly for fuels will be key to the pace of acceleration in headline inflation, in addition to the scope of the targeted assistance aimed at easing the burden from higher cost of living.”