Thailand
Cambodia: IMF report projects low consumer price increases this year
The International Monetary Fund (IMF) has forecast a 3.1 percent increase in Cambodia’s consumer prices for 2021 as the economy recovers from last year’s downturn.
Its World Economic Outlook, which was released on Tuesday in Washington, includes a number of pertinent forecasts for the Kingdom.
Among them are projections for consumer prices to rise by 2.8 percent in 2022. Consumer price increases in 2020 were estimated at 2.9 percent.
The forecast for Cambodian consumer price increases is substantially lower than the 4.9 percent average increase the IMF has forecast for emerging market and developing economies in general in 2021.
It is also lower than projections for four other ASEAN economies – Myanmar (5 percent), Laos (4.9 percent), Vietnam (3.9 percent) and the Philippines (3.4 percent).
Singapore was projected to have the smallest increase in consumer prices (0.2 percent), followed by Brunei (0.8 percent), Thailand (1.3 percent) and Indonesia and Malaysia (both 2 percent).
Commodity prices, particularly for oil are expected to continue “firming up” in the months ahead.
“Given their record-low levels of a year ago, firmer prices should mechanically lift consumer price indices and headline inflation in particular could turn volatile in the coming months,” the outlook said.
It noted, however, that the volatility should be short-lived and that baseline projections show a return of inflation to its long-term average because the remaining slack in the economy will subside only gradually as commodity-driven base effects fade away.
The IMF said the restrained outlook for consumer prices reflected global developments in labour markets.
“Subdued wage growth and weak worker bargaining power have been compounded recently by high unemployment, underemployment and lower participation rates. Moreover, various measures of underlying inflation remain low,” it said.
“IMF staff analysis on sectoral price developments points to muted price pressure, both in sectors where pricing is typically less sensitive to the business cycle and in sectors where prices tend to respond to aggregate demand fluctuations.”
Source: https://www.khmertimeskh.com/50835829/imf-report-projects-low-consumer-price-increases-this-year/