Inflation increased 2.9 pct in October 2021 with rise in fuel prices and the discontinuation of electricity discount in September 2021

Commenting on the report, Chief Statistician Malaysia, Dato’ Sri Dr. Mohd Uzir Mahidin highlighted, “The increase was mainly due to a double-digit increase of 11.3 per cent in the Transport group. In tandem with the rise in global oil prices, the average price of RON97 also increased to RM2.84 as compared to RM1.97 in October 2020. Simultaneously, the index for Housing, Water, Electricity, Gas & Other Fuels rose 3.2 per cent with the highest increase recorded by the Electricity, gas & other fuels subgroup (27.6%). In addition, Furnishings, Household Equipment & Routine Household Maintenance (2.1%) and Food & Non-Alcoholic Beverages (1.9%) indices also contributed to the increase of overall inflation. Meanwhile, other groups, Restaurants & Hotels, Alcoholic Beverages & Tobacco, Recreation Services & Culture and Health recorded marginal increases between 0.2 per cent to 0.6 per cent. Communication remained unchanged while Clothing & Footwear and Miscellaneous Goods & Services declined 0.4 per cent and 0.2 per cent respectively. Education also posted a marginal decline of 0.1 per cent as compared to a year ago”.

He also added that the inflation for coming months will also be influenced by external factors such as the rise in both global crude oil and food prices. In addition, the opening of interstate travel is expected to affect prices of some tourism related groups.

He further explained that the CPI for the period of January to October 2021 increased 2.3 per cent as compared to the same period last year. On a monthly basis, the CPI increased 0.7 per cent as compared to September 2021. The increase was attributed by Housing, Water, Electricity, Gas & Other Fuels (2.5%) and Furnishings, Household Equipment & Routine Household Maintenance (0.4%). Both Miscellaneous Goods & Services and Restaurant & Hotels recorded a marginal increase of 0.3 per cent. He added that the increase was also due to discontinuation of the monthly electricity bill discount given to domestic consumers under the Perlindungan Rakyat dan Pemulihan Ekonomi (PEMULIH) Package for a period of three months which ended 30 September 2021.

Dato’ Sri Dr. Mohd Uzir Mahidin also said, “Core index rose 0.7 per cent in October 2021 as compared to the same month of the previous year. Among the major groups which influenced the increase were Furnishings, Household Equipment & Routine Household Maintenance (2.1%); Food & Non-Alcoholic Beverages (1.2%); Transport (1.1%); Housing, Water, Electricity, Gas & Other Fuels (0.6%); Restaurants & Hotels (0.6%); Health (0.2%) and Recreation Services & Culture (0.2%). Core index covers all goods and services except volatile items of fresh food as well as administered prices.”

Meanwhile, the CPI without fuel increased 1.5 per cent in October 2021 to 114.3 as compared to 112.6 in the same month of the preceding year. CPI without fuel covers all goods and services except Unleaded Petrol RON95, Unleaded Petrol RON97 and Diesel.

All states recorded an increase in the CPI in October 2021. Nine states namely Terengganu (3.9%), Pahang (3.7%), Kelantan (3.6%), Perak (3.4%), Negeri Sembilan (3.2%), Kedah & Perlis (3.2%), Selangor & Wilayah Persekutuan Putrajaya (3.1%), Johor (3.1%) and Melaka (3.1%) surpassed the national CPI rate of 2.9 per cent in October 2021 as compared to the same month of the previous year. All states registered an increase in the index of Food & Non-Alcoholic Beverages. The highest increase was recorded by Selangor & Wilayah Persekutuan Putrajaya (2.7%), followed by Terengganu (2.6%), Pahang (2.5%), Kelantan (2.4%), Perak (2.4%), Johor (2.2%), Melaka (2.0%) and Negeri Sembilan (1.9%). Meanwhile, other states showed an increase below the national index of Food & Non-Alcoholic Beverages rate of 1.9 per cent in October 2021.