6 days ago
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PETALING JAYA: Malaysia’s consumer price index (CPI) fell 1.7% in November to 120 points compared with 122.1 points in the same month of the preceding year, according to the latest figures released by the Department of Statistics.
The drop in the CPI is attributed to declines in the sub-indices for transport (11.1%), housing, water, electricity, gas and other fuels (-3.3%); clothing and footwear (-0.5%) and furnishings, household equipment and routine household maintenance (-0.1%), which contributed 45.7% to overall weight.
Chief Statistician Malaysia Datuk Seri Mohd Uzir Mahidin highlighted that out of 552 items covered in the CPI, 334 items showed an increase in November 2020 as against November 2019.
Meanwhile, 153 items declined while 65 items were unchanged for the month.
He said the non-durable goods category, which accounts for 296 items, saw the most price increase with 204 items, while 78 items reported a decrease and 14 items were unchanged compared with services, semi-durable goods and durable goods categories.
“Nevertheless, food & non-alcoholic beverages increased by 1.4% to 135.1 as compared to 133.3 in the corresponding month of the preceding year,” said Mohd Uzir. “This group contributes 29.5% of CPI weight.”
Similarly, miscellaneous goods and services increased by 2.3%, followed by health (1%), education (0.6%), alcoholic beverages and tobacco (0.5%), and recreation services and culture (0.1%).
“The CPI without fuel fell 0.1% in November 2020 compared with November 2019. CPI without fuel covers all goods and services except unleaded petrol RON95, unleaded petrol RON97 and diesel,” said the chief statistician.
Overall, the core index rose 0.7% in November year on year, influenced by the increases in miscellaneous goods and services (2.3%), food and non-alcoholic beverages (1.2%), health (1%), housing, water, electricity, gas and other fuels (0.6%), and education (0.6%).
From January to November this year, CPI fell 1.1% year on year, attributed to a decline in transport (-10.1%), housing, water, electricity, gas and other fuels(-1.7%) and clothing and footwear (-1%).
On a monthly basis, CPI fell 0.2% on the back of declines in transport (1%), alcoholic beverages and tobacco (-0.1%), miscellaneous goods and& services (-0.1%), furnishing, household equipment and routine household maintenance (-0.1%), and education (-0.1%).
In November, the index for all states decreased between -1.2% and 2.6% with the highest recorded by Malacca and Kedah & Perlis at -2.6% respectively, followed by Sabah & Labuan -2.5%), Sarawak -2.4% and Negri Sembilan -2.4%.
However, all states registered an increase in the index of food and non-alcoholic beverages.
The highest jump was recorded by Selangor & Putrajaya at 2.0%, then Terengganu 1.8%, Johor 1.7% and Kelantan 1.5%.
In a report, UOB Research said the deflationary trend is expected to reverse course by first-quarter 2021 as consumption-induced incentives will lapse by the end of this month, global oil prices are projected to stay above US$50 a barrel next year, more progressive economic recovery once scheduled vaccinations start in February and the low base effect.
“The government is also due to announce the 2021 electricity tariffs this week, whereby expectations are for slightly lower electricity tariffs for 2021 following the reduction in the current cost of the production of coal and gas. Meanwhile, water tariffs are due to be revised upwards next year,” it said.
UOB Research is maintaining its 2021 full-year inflation target of 2.1%.
Separately, the research house foresees matters on fuel subsidies may resurface should global oil prices persist their uptrend towards US$55/bbl and above.
“Given both the growth and inflation outlook remain in line with assessment, we continue to expect Bank Negara Malaysia to keep the key policy rate unchanged at its next monetary policy meeting on 19-20 Jan 2021. We project the Overnight Policy Rate to be kept unchanged at 1.75% until end-2021,” it concluded.
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