Business

Tuesday September 15, 2009

Malaysia's CPI dropping at a slower pace


KUALA LUMPUR: Malaysia’s consumer price index (CPI) likely fell for a third straight month in August but at a slightly slower pace than in July, according to a Reuters poll of 12 economists.

August consumer price inflation likely fell 2.35% from a year earlier following a fall of 2.4% in July. Consumer prices fell in June by 1.4%, the first time CPI turned negative since August 1986, according to Reuters data.

Economists said August’s decline was largely due to the lingering base effect from last year when global food and energy costs were spiking, but that this month’s consumer prices might grow on a month-on-month basis due to taxi and bus fare hikes.

“All eyes will be on the effects of the taxi and bus fare hikes on the price barometer this month,” said DBS economist Irvin Seah. — Reuters

Bank Negara, at its last monetary policy meeting in August, left rates unchanged at 2%, saying that inflation would remain negative in the third quarter but would turn positive with an improvement in the domestic economy.

The central bank’s next monetary police meeting is on Oct 28. Most economists expect it to keep rates on hold until at least the middle of 2010 as it waits to confirm the economy is again on solid footing. — Reuters


For reports from the Statistics Department click here

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