Malaysia's July consumer price index up 1.4% year-on-year, slightly below forecast

[KUALA LUMPUR] Malaysia's consumer price index rose 1.4 per cent in July from a year earlier, a bit slower than the previous month, government data showed on Wednesday.

Economists surveyed by Reuters had forecast for the index to climb 1.5 per cent year-on-year in July, matching the pace in June.

June's annual inflation rate was the fastest in more than a year, as the effects of tax policy changes introduced last year faded.

Inflation has been mild since an unpopular consumption tax was scrapped in June 2018, while transport costs have fallen amid a government effort to cap domestic fuel prices.

Inflation in July saw increases in 10 of the 12 groups tracked in the index, particularly household furnishings and equipment, food, tobacco, communication and recreational services, data from the Statistics Department showed.

Costs, however, were down in the transport and clothing sectors, the data showed.

Last month, Malaysia's central bank said headline inflation was expected to accelerate in the second half of the year.

Analysts, however, expect slowing economic growth to keep price pressures in check.

In May, Bank Negara Malaysia cut its key interest rate for the first time since 2016, amid low inflation and concerns over slowing growth.

REUTERS