KUALA LUMPUR: Headline inflation is likely to ease further in July and expectations are for the Consumer Price Index to record a 3.3 per cent average growth.
The Statistics Department will release the data tomorrow.
Standard Chartered Bank economist Edward Lee said transport inflation may have eased as domestic fuel prices fell by about 2.7 per cent month-on-month on lower global oil prices.
“Food prices likely remained a significant contributor to headline inflation. “
StanChart expects headline inflation to moderate in the second half of the year, remaining within the central bank’s comfort level, especially as inflation has not been demand-induced.
Lee said core inflation in July may also have inched up marginally to 2.6 per cent year-on-year from 2.5 per cent in June.
Headline inflation moderated to 4.0 per cent in the second quarter from 4.3 per cent in the first quarter due mainly to lower transport inflation of 13.4 per cent (from 16.2 per cent in the first quarter) said Bank Negara Malaysia last week.
The lower domestic fuel prices were due mainly to the lower global oil prices amid a stronger ringgit exchange rate during the quarter.
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CPI FORECAST FOR JULY (% year-on-year)
AffinHwang Capital Research3.3
DBS Bank3.2
HSBC Bank3.4
Kenanga Investment Bank3.3
Nomura Research 3.2
Standard Chartered Bank3.2
UOB Bank3.5
Average3.3