Malaysia's inflation slows to 3.7% in January

KUALA LUMPUR: Malaysia's rate of inflation in January slowed to 3.7% as price growth in the country remained on a downtrend that began in October 2022.

The increase in the consumer price index, which was lower compared with 3.8% in December 2022, was in line with the median forecast of economists polled by Reuters.

In a statement, national chief statistician Datuk Sri Mohd Uzir Mahidin said the January inflation rate in Malaysia was lower than that of the Philippines, Indonesia, South Korea and Thailand.

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Core inflation, which measures changes in the prices of goods and services without considering the volatile prices of fresh food as well as administered prices of goods by the government, registered a slower increase of 3.9%.

According to Mohd Uzir, the increase in the January CPI was driven by restaurants and hotel (6.8%), food and non-alcoholic beverages (6.7%) and transport (4%).

"Food and non-alcoholic beverages group which contributed 29.5% of total Consumer Price Index (CPI) weight recorded a slower increase as compared to December 2022.

"The increase in this group was mainly attributed by the component of food away from home which moderated to 9.3% as compared to 9.6% in December 2022, while food at home increased 5.1% as compared to the previous month (December 2022: 4.9%)," said Mohd Uzir.

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He added that all subgroups within the food and non-alcoholic beverages group recorded an increase of 0.7% to 9.1%.

The meat subgroup meanwhile registered an increase of 8.3% as compared with 7.8% in December 2022.

Chicken as the largest component in the subgroup (46.1%) increased to 6.5% as against to 5.8% in the previous month.

In the transport group, inflation registered a slower increase of 4% in January as compared to 4.9% in December 2022, due to the lower increase in the average price of unleaded petrol RON97.

"On a year-on-year basis, the average price of Unleaded petrol RON97 eased to 9.5% (RM3.35 per litre) as compared to 20% recorded in December 2022 (RM3.60 per litre).

"The moderate increase in fuel prices was a direct impact of the decrease in the price of Brent crude oil (-2.9%) to US$83.09 per barrel in January 2023," said Mohd Uzir.