Low impact on inflation from diesel price hike

Finance Ministry Treasury Secretary-General Datuk Johan Mahmood Merican believes the targeted inflation rate will not be revised upwards following the removal of the diesel subsidy.

KUALA LUMPUR: The inflationary impact from the one-off diesel subsidy rationalisation measure by the government is likely contained, given diesel’s small 0.2% weight in the consumer price index (CPI) basket.

However, there are concerns about businesses finding loopholes or excuses to raise prices indiscriminately to reflect the purported higher cost of doing business with the diesel price hike.