KUALA LUMPUR: The headline inflation for June decreased to -1.9% compared with -2.9% in May, driven largely by the higher domestic retail fuel prices during the month.
Bank Negara, in its monthly highlights report, said that the risk of deflation remains contained as underlying inflation, as measured by core inflation, increased slightly to 1.2%.
“The higher share of consumer price index items recorded month-on-month price increases (June: 44%; May: 36%), suggesting a further normalisation of price pressures, ” it said.
The note added that exports registered a turnaround to grow by 8.8% in June compared with a contraction of 25.5% in May, supported by higher manufactured exports, particularly electrical and electronics as well as non-resource-based products such as optical and scientific equipment, machinery as well as equipment and parts.
“Following the trough in May 2020, exports are expected to gradually pick up in the second half of 2020, as external demand improves with the easing of containment measures in most economies, ” the central bank said.
Bank Negara said total outstanding loans grew by 4.1% in June compared with 3.9% in May, supported by higher outstanding household loans.
Outstanding corporate bond growth increased to 2.5% compared with 1.9% in May.
“The higher household loan growth, which stood at 3.5% in June compared with 3.2% in May, was mainly contributed by housing and securities loans amid higher disbursements.
“Outstanding business loan growth moderated to 4.2% compared with 4.5% in May as repayments expanded faster than disbursements.
“Of note, disbursements normalised from the low levels during April and May, with high disbursements for working capital needs, ” it said. — Bernama
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