Headline inflation slips to 0.9% in November

The index for the period between January and November 2019 recorded a 0.7% increase against the same period a year earlier

by SHAHEERA AZNAM SHAH/ pic by MUHD AMIN NAHARUL

MALAYSIA’S Consumer Price Index (CPI) — a measure of the country’s inflationary level — rose 0.9% year-on-year (YoY) to 122.1 points in November from 121 points last year, mainly driven by the increase in goods and services index.

The index for the period between January and November 2019 recorded a 0.7% increase against the same period a year earlier, Department of Statistics Malaysia chief statistician Datuk Seri Dr Mohd Uzir Mahidin said.

“The increase in the overall index was driven by the index of miscellaneous goods and services, housing, water, electricity, gas and other fuels as well as education,” he said in a statement last Friday.

On a monthly basis, the CPI rose 0.1% in November against the previous month, mainly supported by the index of housing, water, electricity, gas and other fuels, miscellaneous goods and services, as well as health.

Three states, namely Kuala Lumpur, Selangor and Penang, recorded higher inflationary rates, surpassing the national CPI rate of 0.9% in November 2019.

“All states registered an increase in the index of food and non-alcoholic beverages.

“Meanwhile, Selangor and Putrajaya, followed by Kuala Lumpur, Penang, Perak, Johor, Kedah and Perlis surpassed the national index of food and non-alcoholic beverages in November 2019,” Mohd Uzir said.

The country’s core index rose 1.4% for the month against the November last year, mainly influenced by the increases in goods and services, housing, water, electricity, gas and other fuels, as well as food and non-alcoholic beverages.

“Core index excludes most volatile items of fresh food as well as administered prices of goods and services,” Mohd Uzir said. For the food and non-alcoholic beverages group, the index increased 1.5% YoY last month, attributed to the sub-groups of vegetables, food products, as well as milk and eggs.

The November CPI reading was below the forecast of economists surveyed by Reuters, who had predicted a higher increase of 1.2% due to a drop in prices for clothing and footwear, as well as lower transport costs.

The index last fell below the 1% level in March, April and May 2019, when it grew just 0.2% YoY for all three months after two months of deflation.

For October, the CPI increased by 1.1% from a year ago.

In June last year, the inflation rate fell below 1% for the first time in 40 months due to the zero-rated Goods and Services Tax, and discounted prices of goods.

Bank Negara Malaysia said last month it expects the country’s headline inflation to be “low” in 2019 and remain modest with a slight increase in 2020.