Malaysia’s CPI moderated to 2.2% yoy in July compared to 3.4% yoy in the previous month. This was the sixth straight month of inflation since February 2021. The moderation is within expectation, taking into account the fading base effect, presence of mobility restrictions and government subsidies. On a monthly basis, consumer prices contracted by 0.6% compared to a 0.1% gain in the previous month which marked the first monthly decline after seven straight months of increases.
The increased in non-food price index eased slightly to 2.6% yoy (Jun: +2.7%) while food price index grew constantly by 1.3% yoy (Jun: +1.3%). CPI without fuel, which covers all goods and services except RON95, RON97 and Diesel, increased 0.8% in July (Jun: +1.5%).
Meanwhile, increased in durable goods price weakened to +0.9% yoy (Jun: +1.1%). The prices of semi- durable goods declined by -0.3% yoy (Jun: - 0.3%), while non-durable goods rose by 4.6% yoy (Jun: +7.9%). Meanwhile, CPI for the period of January to July 2021 increased 2.3% compared to the same period last year. The incline was attributed by Transport (+10.9%), Food & Non-Alcoholic Beverages (+1.5%) and Furnishings, Household Equipment & Routine Household Maintenance (+1.2%).
Food inflation stalled amidststrict mobility restriction. The index for Food & Non-Alcoholic Beverages (FNAB), which contributes 29.5% of CPI weight, held steady at 1.3% yoy in July (Jun: +1.3%; May: +1.5%) due to the stringent COVID-19 containment measures under national recovery plan (NRP). The prices rose included oil & fats (Jul: +4.1%; Jun: +4.0%; May: +3.4%), fish & seafood (Jul: +3.4%; Jun: +3.3%; May: +3.2%), food products not elsewhere classified (Jul: +2.1%; Jun: +2.0%; May: +2.3%), and milk, cheese & egg (Jul: +1.9%; Jun: +1.5%; May: +0.6%). Among the index of goods which recorded year-on-year price increase in most states were kai lan (13.5%), french beans (13.3%), bitter gourd (13.0%) and blended cooking oil (12.7%). The index for food away from home increased 1.3% yoy (Jun: +1.3%; May: +1.4%). Meanwhile, prices increase of food at home remained at +1.3% (Jun: +1.3%; May: +1.5%).
Transport price sustained a double-digit increase in July but at a slower pace. Transport price eased to 11.6% from +16.6% in June (May: +26.0%) as the fading effect of the low base on higher global oil prices continue. Besides, transport prices stayed by double-digit growth for the fourth month because of the lower base from low fuel prices last year. The moderation was attributed by the operation of personal transport equipment (Jul: + 14.3%; Jun: +20.6%; May: +32.8%) and transport services (Jul: -0.4%; Jun: +0.1%; May: +4.4%). The increased in costs of personal transport equipment was contributed mainly by inflation for the fuels & lubricants which remained at double-digit growth albeit moderating to 21.8% (Jun: +32.8%; May: +56.1%), reflecting the movement in domestic retail fuel prices. The average price of Unleaded Petrol RON95 in July 2021 increased to RM2.05 per litre compared to RM1.69 in July 2020. In addition, the average price of Unleaded Petrol RON97 increased to RM2.72 per litre as compared to RM1.99, while the average price of Diesel increased to RM2.15 as compared to RM1.85 in July 2020.
Core inflation remained subdued. Core inflation - which excludes most volatile items of fresh food as well as administered prices of goods and services – was unchanged at +0.7% yoy. Core inflation stayed below the 1.0% level for the tenth consecutive month, suggesting demand inflation were still subdued. Services inflation grew by 0.7% yoy in July, slightly lower than the previous month (Jun: +0.8%; May: +0.9%).
Five states above national CPI. Five states namely Terengganu (2.8%), Pahang (2.5%), Selangor & Wilayah Persekutuan Putrajaya (2.4%), Kelantan (2.4%), and Sarawak (2.3%) surpassed the national CPI rate of 2.2% in July 2021 as compared to July 2020. Meanwhile, all states registered an increase in the index of Food & Non-Alcoholic Beverages. Meanwhile, other states showed an increase below the national index of Food & NonAlcoholic Beverages rate of 1.3% in July 2021 as compared to July 2020.
Source: BIMB Securities Research - 26 Aug 2021
Created by kltrader | Aug 12, 2024
Created by kltrader | Aug 12, 2024
Created by kltrader | Aug 09, 2024
Created by kltrader | Aug 09, 2024