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Malaysia Expects Higher Inflation this Year

Jun 6, 2008 Trade


Malaysia predicted that its inflation would climb up to 4.2 percent this year as a results of fuel prices hike it announced on Wednesday.


Malaysia's central banker governor Zeti Akhtar told reporters at the 12th Malaysian Banking Summit here Thursday that the inflation for this month was expected to exceed 5.0 percent.


Earlier this year, the bank estimated the country's inflation for this year at 2.5 percent.


The Malaysian government raised the country's petrol price by 0.78 ringgit (0.24 U.S. dollars) to 2.70 ringgit (0.84 U.S. dollars) per liter on Wednesday, which became effective on Thursday.


It also raised the country's diesel price by one ringgit (0.31 U.S. dollars) to 2.58 ringgit (0.81 U.S. dollars) per liter.


Meanwhile, the government had agreed on a cash rebate for Malaysian owners of private cars and motorcycles to ease the burden of the rise in the fuel prices.


The move was part of the Malaysia's new fuel subsidy scheme mechanism to reduce its fuel subsidy which amounts to 53 billion ringgit (16.5 billion U.S. dollars) each year.


Malaysia's national news services said that despite the fuel price hikes, Malaysia was still one of the countries with low fuel prices in the region.


Zeti also said that although inflation is expected to hit about 5.3 percent in the first half of next year, the country's inflation rate was still relatively lower than those of some other countries.

 

Source: CRIEnglish

 

 
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