The country’s inflation in February was only 2.2%, but why is this figure different from what consumers really feel?
According to data released by the Department of Statistics Malaysia, the Consumer Price Index (CPI) rose by 2.2% in February 2022 compared to the same month last year, and by 0.20% compared to January.
The price index for food and non-alcoholic beverages increased 3.7% y/y in February, while transportation costs rose 3.90%. Furniture, household equipment and routine home maintenance rose 3.2% y/y, while restaurants and hotels increased 2.6%.
Our CPI data for February also showed that chicken prices increased by 14.2% compared to the same month last year, while egg prices rose by 13.5% y/y. Food prices have increased the most, and food price increases can be felt most by consumers, which is why the inflation rate is only 2.2%, yet consumers feel that items have been going up in price significantly.
If we look at the state, Selangor and Putrajaya recorded the highest inflation rate, which is 2.9%. In Johor, Pahang, Kuala Lumpur, Sabah and Labuan, and Negeri Sembilan, the inflation rate is below 2.0%.
In recent months, the prices of daily food, daily necessities, construction materials, household appliances and auto parts have been increasing, and consumers have been crying out that they cannot afford it. It is very likely that the National Bank will raise interest rates in the second half of the year to curb domestic inflation.
