Malaysia Inflation Likely Eased to 4.2% in May, Poll Shows

By Yantoultra Ngui Features Dow Jones Newswires

KUALA LUMPUR, Malaysia--Malaysia's inflation likely eased further in May, a survey of economists showed Monday, marking the second month of moderation from an eight-year high of 5.1% in March.

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The consumer-price index, the country's main inflation gauge, is expected to have risen 4.2% in May from a year earlier, according to the median forecast of eight economists surveyed by The Wall Street Journal, because of moderating fuel prices domestically. The CPI grew 4.4% in April.

Mohd Afzanizam Abdul Rashid, chief economist at Kuala Lumpur-based Bank Islam Malaysia, said a stronger ringgit during the month could have alleviated price pressures.

The inflation rate is "still a concern despite the expected moderation," he said in an interview Monday, as the CPI remains higher than the long-term average of 2.8%-3.0%.

Bank Negara Malaysia said in March that inflation was projected to trend higher at 3.0%-4.0% this year, compared with 2.1% in 2016, mainly because of the pass-through effect of higher global oil prices on domestic retail-fuel prices.

However, the central bank said that cost-driven inflation is unlikely to have a significant effect on broader price trends. It said it expects core inflation to rise modestly.

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The official May inflation data is due Wednesday at 0400 GMT.

Write to Yantoultra Ngui at yantoultra.ngui@wsj.com

(END) Dow Jones Newswires

June 19, 2017 01:40 ET (05:40 GMT)