FUEL PRICE HIKES PUSH UP CPI

In­dex edged up 4.5pc last month, the high­est level in eight years

New Straits Times - - Business - RUPA DAMODARAN KUALA LUMPUR ru­pa­banerji@me­di­aprima.com.my

THE Con­sumer Price In­dex (CPI) jumped by 4.5 per cent last month, mostly due to the in­crease in petrol prices.

This marks the high­est level in eight years.

The Sta­tis­tics Depart­ment said the ma­jor groups which recorded in­creases in their in­dices were trans­port (17.9 per cent) and food and non-al­co­holic bev­er­ages (4.3 per cent).

It said the in­dex for the trans­port group rose from 8.3 per cent in Jan­uary.

The av­er­age price of a litre of RON95 petrol was RM2.30 last month com­pared with RM1.75 in Fe­bru­ary last year.

As for RON97, the av­er­age price in­creased to RM2.60 last month from RM2.05 in Fe­bru­ary last year.

On food and non-al­co­holic bev­er­ages, which ac­counted 30.2 per cent in the CPI weights, the in­crease was led by oils and fats (38.3 per cent) and veg­eta­bles (9.5 per cent).

The Sta­tis­tics Depart­ment also high­lighted that seven states recorded higher in­creases for the food and non-al­co­holic bev­er­ages in­dex, ris­ing above the na­tional level in­dex.

Malacca led the pack with 5.4 per cent, fol­lowed by Jo­hor (5.3 per cent) and Kuala Lumpur (5.1 per cent).

Stan­dard Char­tered Bank econ­o­mist Ed­ward Lee said the head­line in­fla­tion would likely tick up fol­low­ing trans­port prices which in­creased by about eight per cent af­ter 10 con­sec­u­tive months in neg­a­tive ter­ri­tory. Ahead of the re­port, he said that the CPI would pick up last month as lo­cal fuel prices rose 27 to 31 per cent year-on-year on high global oil prices and a weaker do­mes­tic cur­rency.

Lee said food prices might have con­trib­uted sig­nif­i­cantly to in­fla­tion as well, with the United Na­tions Food Price In­dex up by about 17 per cent year-onyear last month.

“We ex­pect in­fla­tion to con­tinue to pick up this year on higher oil prices and a low oil price base ef­fect.”

At the an­nual re­port brief­ing on Thurs­day, Bank Ne­gara Malaysia gov­er­nor Datuk Muham­mad Ibrahim warned that the head­line in­fla­tion would be in the range of three to four per cent this year with higher en­ergy and com­mod­ity prices.

We ex­pect in­fla­tion to con­tinue to pick up this year on higher oil prices and a low oil price base ef­fect.

ED­WARD LEE Stan­dard Char­tered Bank econ­o­mist

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