January inflation up 3.5% from year ago but below forecast

Index for food & non-alcoholic beverages (weight: 30.2) rose 3.9% on a year-on-year basis in January 2016.

KUALA LUMPUR: Malaysia’s inflation rate, as measured by the Consumer Price Index (CPI) rose 3.5% from a year ago due to increases in all 12 major groups.

However, the CPI was below economists’ forecast of a 3.7% increase.

The Statistics Department said on Wednesday the CPI was slightly lower by 0.3% from December 2015.

On the 3.5% increase in the CPI for January, it said among the major groups which recorded increases were the index for alcoholic beverages & tobacco group by 22.6%; miscellaneous goods and services (+5.5%); and health (+4.6%); 

The index for food & non-alcoholic beverages (weight: 30.2) rose 3.9% on a year-on-year basis in January 2016.

The index for non-Food (weight: 69.8) recorded an increase of 3.4%.

The department said the core inflation also rose 3.6% in January from a year ago.

“Core inflation differs from overall CPI (headline CPI) in that it is calculated by excluding prices for goods and services that are subject to fluctuations which considered transitory in nature and do not have a lasting impact on the underlying trend in inflation. 

“These include nine of the CPI's most volatile items of fresh food, as well as administered prices of goods and services. Core inflation measures are used as operational guides for monetary policy in assessing the direction of inflation,” it said.