Malaysia’s July CPI higher than JP Morgan’s expectations

KUALA LUMPUR: Malaysia’s consumer prices rose 0.7 per cent month-on-month in July, leaving headline consumer price index (CPI) higher than J.P. Morgan’s expectations at -1.3 per cent.

The US investment bank said in sequential terms, the headline CPI had expanded at a faster -4.4 per cent quarter-on-quarter.

Meanwhile, JP Morgan said core prices, which exclude the most volatile fresh food items and administered prices of goods and services, had inched up 0.1 per cent m-o-m, leaving core inflation at 1.1 per cent.

The bulk of the overall price increase last month can be attributed to the 4.9 per cent m-o-m rise in transport-related costs.

This trend has been consistent in recent months as other price categories continue to record subdued price upticks.

Malaysia’s retail pump prices rose 9.4 per cent m-o-m as crude oil prices increased by 14.8 per cent m-o-m on average in June and July.

Other categories recorded modest price increases or remained flat last month.

JP Morgan said with uncertainties around the Covid-19 situation and the prevailing weak labour market conditions, its policy call for a 25 basis point cut at Bank Negara Malaysia’s September 10 Monetary Policy Committee meeting remained intact.

Source: NST