Malaysian inflation at 8-year high

• Mar 24, 2017

KUALA LUMPUR – Consumer prices in Malaysia rose at the fastest pace in more than eight years in February, adding to the central bank’s policy dilemma as it tries to keep interest rates low to support the economy.

CPI rose 4.5% in February from a year ago, exceeding the median estimate of 3.9% in a Bloomberg survey of 23 economists and the highest forecast of 4.3%

Prices rose 1.3% from the previous month.

Inflation has spiked in recent months due to higher fuel prices, adding pressure on the central bank to raise interest rates.

Bank Negara Malaysia said on Thursday inflation will probably average 3% to 4% this year, up from 2.1% in 2016, adding that 2017 will be another challenging one for monetary policy. The bank has left its benchmark rate unchanged at 3% since a surprise cut in July.

Transport costs surged 17.9% in February from a year ago, after increasing 8.3% in the previous month

Food prices, which makes up 30% of the CPI basket, rose 4.3% from a year ago.

Source: http://www.bangkokpost.com/business/world/1220521/malaysian-inflation-at-8-year-high