Milder inflation in September

• Inflation increased 1.1% yoy

• Core inflation grew by 1.5%

• Global inflation remains tame

• Inflation to remain benign

Malaysia's inflation rate slowed to 1.1% yoy in September from 1.5% in the previous month. This was the lowest inflation rate since May this year, as food prices rose the least in four months, housing inflation eased and transport cost fell further. On a monthly basis, consumer prices were flat in September, after a 0.2% gain in August.

Food & non-alcoholic beverages (FNAB), which account for 29.5% of the CPI weights, increased by 2.2% yoy in September, the least in four months, following a 2.6% rise in August. At the same time, prices slowed for housing, water, electricity, gas & other fuels, alcoholic beverages & tobacco, health, recreation services & culture, furnishing, household equipment & routine maintenance and restaurants and hotels. In addition, cost fell further for transport, clothing and footwear and communication. On the other hand, prices went up faster for both miscellaneous goods & services and education.

CPI for 3Q19 increased 1.3% yoy and on the quarterly basis the CPI increased 0.3% as compared to 2Q19. The CPI for the period of January-September increased by 0.6% as compared to the same period of the preceding year.

Source: BIMB Securities Research - 23 Oct 2019