Inflationary pressures, price hikes temporary

The US Federal Reserve has signalled that it would increase its Overnight Policy Rate (OPR) multiple times this year to tame inflation. “Malaysia will likely follow suit by increasing its OPR gradually in 2022 and 2023, whereby Bank Negara is expected to increase the OPR by about 50 basis points in the later half of this year,” Ideas said.

KUALA LUMPUR: The Institute for Democracy and Economic Affairs (Ideas) believes that the inflationary pressures and price hikes that Malaysia is facing is temporary and can be effectively controlled through proper monetary and fiscal policies.

According to the Statistics Department, the country’s inflation rate (as measured by the Consumer Price Index) increased 3.2% year-on-year in December 2021, mainly due to the rise in food and fuel prices and the low base effect.