PETALING JAYA: The surge in Covid-19 cases over the past month has resulted in a pullback of Malaysia’s consumer price index (CPI) in November.
The CPI declined 1.7% year-on-year (y-o-y) last month to 120 points compared with 122.1 points in November 2019.
It was a slight contraction compared with October which recorded 120.2 points or a 1.5% decline y-o-y.
The decrease was attributed to the decline in 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 the overall weight.
Chief statistician Datuk Seri Dr Mohd Uzir Mahidin (pic below) said 334 out of 552 items recorded an increase in November 2020 compared with November 2019.
“On the contrary, 153 items declined while 65 items were unchanged.
“Based on the performance of 552 items by category of goods and services, non-durable goods was the category that experienced the most price increase with 204 items, reduction in 78 items while 14 items were unchanged as compared to services, semi-durable goods and durable goods, ” he said in a statement yesterday.
Food and non-alcoholic beverages rose 1.4% to 135.1, contributing 29.5% of the CPI weight. Similarly, miscellaneous goods and services increased 2.3%, followed by health (1.0%), education (0.6%), alcoholic beverages and tobacco (0.5%) and recreation services and culture (0.1%).
“The average price of RON95 in November 2020 decreased to RM1.63 per litre compared with RM2.08 in November 2019 while the average price of RON97 decreased to RM1.93 per litre compared with RM2.62 while the average price of diesel declined to RM1.75 per litre from RM2.18 in the corresponding month of the preceding year, ” said Uzir.
Meanwhile, the CPI for the period of January to November 2020 declined 1.1% as compared to the same period last year.
The index for all states decreased between -1.2% to -2.6% last month, with the highest decrease recorded by Melaka, Kedah and Perlis at -2.6%.
MIDF Research said in a report that the resurgence of Covid-19 cases in key countries somehow influenced the expectation of the upward trend in inflationary pressure. “Instead, consumer inflation moderated or even slipped into deflation again as demand weakened, ” it said.
The research house added that improvement in oil prices were anticipated to remain sluggish on mounting demand concerns particularly over surging Covid-19 cases.
It also said that the implementation of government electricity bill discounts until the end of the year will cushion some impact of utilities charges on the consumers hence contributing to the downward pressure of the CPI.
“We opine that the recovery for spending on non-essential items and the overall domestic expenditures will take time to fully recover.
“Consumers may hold back their spending plans on concerns over future personal finances and the outlook of the job market.
“In view of recovering economic activities, we foresee that Bank Negara will not be pressured to further ease the policy rate for now, ” MIDF said.