Malaysia's Consumer Price Index (CPI) continued its downward trend in June, reaching the lowest level recorded in 2023 at 2.4 percent, as reported by the Department of Statistics Malaysia (DoSM).

The rate of inflation has been showing signs of moderation since January, when it stood at 3.7%. In May, inflation was recorded at 2.8% year-on-year.

Chief Statistician Datuk Seri Dr. Mohd Uzir Mahidin stated that the slower increase in June was primarily driven by lower increments in key components, including restaurants and hotels (5.4%), food and non-alcoholic beverages (4.7%), and furnishings, household equipment, and routine household maintenance (2.3%).

The food and non-alcoholic beverages group, which holds a significant weight of 29.5% in the total CPI, increased at a more moderate rate of 4.7% in June, compared to 5.9% in May 2023.

Further analysis reveals that the component of food at home grew at a slower rate of 3.2% in June, compared to 4.3 percent in May 2023. Similarly, the food away from home component's increase slowed to 6.8% from 8.1% previously.

When examining state-level inflation, Mohd Uzir highlighted that ten states recorded increases below the national inflation level of 2.4 percent, with Labuan Federal Territory experiencing the lowest increase at 1.2% in June. On the other hand, six states recorded inflation levels above the national average, including Sarawak (3.0%), Pahang (2.9%), Putrajaya (2.8%), Selangor (2.7%), Perak (2.7%), and Melaka (2.7%).

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Comparing Malaysia's inflation rate with selected countries in the Asia-Pacific region, it was found to be lower than that of South Korea, Indonesia, and the Philippines.

Meanwhile, inflation in the eurozone experienced a slower rate of increase at 5.5% in June 2023, compared to 6.1% in the previous month. Similarly, inflation in the United States eased to 3.0%, down from 4.0% in May.

The decreasing trend in Malaysia's inflation rate is a notable development, offering some relief to consumers amidst economic uncertainties. Analysts will continue to monitor economic indicators to assess the overall health of the economy in the coming months.

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Source: Bernama