KUALA LUMPUR – The inflation rate is expected to increase by 2% in 2020 due to the introduction of targeted fuel subsidy.
This increment is also partly contributed by the implementation of departure levi.
The inflation projection will also be subjected to the foreign exchange rate and the uncertainties of global fuel price following the trade and geopolitical wars.
The Consumer Price Index has dropped 2% from January to August 2019 due to the reduction of index in the agricultural, forestry and fisheries (10.3%), mining (3.8%) and manufacturing (1.1%) sectors.
The condition was due to the lower commodity prices, especially crude oil and palm oil, which reduces the cost of production.
The Producer Price Index (PPI) is expected to remain at a lower rate.
Nevertheless, it is expected to increase in 2020 when the production activity is back to its normal range. -MalaysiaGazette