Malaysia's September inflation down 1.4 pct

Daniel Fowler
October 24, 2020

The government on Thursday launched a new series for Consumer Price Index - Industrial Workers (CPI-IW) changing the base year to 2016 from 2001, but said it will not have any immediate impact on the dearness allowance (DA) paid to government employees.

The data agency said the consumer price index would have increased by 1.0 per cent in September had a 10.7 per cent year-over-year drop in the price of gasoline not been factored in.

Air transportation prices fell by 3.2 per cent in September compared to a 16 per cent drop in August, bucking the traditional yearly trend of declines in September as demand weakens after the summer travel season.

The Consumer Price Index-Industrial workers (CPI-IW) is the single most important price statistics with financial implications.

CPIH inflation, the ONS' headline measure which includes owner occupiers' housing costs, rose from 0.5% in August to 0.7% in September. Nevertheless, there were groups that showed an increase, namely, restaurants & hotels (0.2%), alcoholic beverages & tobacco (0.1%), furnishings, household equipment & routine household maintenance (0.1%), recreation services & culture (0.1%) and education (0.1%).

The CPI-IW for the month of September, 2020, under the new series stood at 118; while under the 2001 base, the CPI-IW for August, 2020 was 338. On a quarterly basis, the CPI rose 1.5% compared with the second quarter.

Another 223 new COVID-19 cases recorded in B.C.
In their statement Friday, Henry and Brown also urged B.C. residents not to rush to judgment in assessing the behaviour of others. A total of 10,247 people are now considered fully recovered from the virus, constituting 82 per cent of all known cases.

The average price of unleaded petrol RON95 in September 2020 decreased to RM1.68 per litre compared with RM2.08 in September 2019.

The highest decrease was recorded by Melaka (-2.2 per cent), Sabah & Labuan (-2.2 per cent) and Kedah & Perlis (-2.2 per cent), followed by Sarawak (-2.1 per cent), Negeri Sembilan (-1.9 per cent) and Johor (-1.9 per cent).

The month-on-month change was contributed to by increases of index values of food items by 0.52% and non-food items by 0.23%.

The Canadian dollar was trading almost unchanged at 1.3122 to the greenback, or 76.21 US cents, having pulled back from an earlier six-week high at 1.3081. "It suggests monetary policy will need to remain accommodating for a long period of time".

In a research note today, the investment bank said price pressure on the demand side should remain subdued given the weak economic momentum this year.

Year to date, the deflation rate is at -1%. Labour secretary Apurva Chandra said base year will now be changed every five years. Inflation was 2.2% in February, before the pandemic hit. Downside risks to growth have materialised amid the third wave of Covid-19 infections and reinstatement of tighter movement restrictions in Selangor, Kuala Lumpur, Putrajaya, and Sabah.

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