KUALA LUMPUR: Higher fuel prices pushed the consumer price index (CPI) higher in July – a straight six-month rise – but the monthly electricity bill discount given to domestic consumers helped mitigate the overall increase.
The Statistics Department said yesterday that the CPI rose by 2.2% to 122.5 from 119.9 a year ago due to the lower base effect then.
The electricity bill discount was under the National People’s Well-Being and Economic Recovery Package (Pemulih) for three months effective July 1.
However, the discounts were not enough to offset the impact of the increases of the petrol and diesel prices in July 2021 as compared to a year ago.
Chief statistician Datuk Seri Dr Mohd Uzir Mahidin said the July CPI remained positive for the sixth consecutive month since February 2021 due to the lower base effect last year.
“The increase was mainly driven by a double-digit increase of 11.6% in the transport group due to the setting of the RON95 petrol ceiling price to RM2.05 per litre since March as compared to the average price of RM1.69 in July 2020.
“This was followed by furnishings, household equipment and routine household maintenance (1.7%), food and non-alcoholic beverages (1.3%) as well as housing, water, electricity, gas and other fuels (0.7%),” he said.
The increase was mainly driven by a double-digit increase of 11.6% in the transport group due to the setting of the RON95 petrol ceiling price to RM2.05 per litre since March as compared to the average price of RM1.69 in July 2020.
The CPI for January to July 2021 increased by 2.3% from the previous corresponding period.
However, the July CPI, when compared to June, decreased by 0.6% due to the decline in housing, water, electricity, gas and other fuels (-2.5%) and alcoholic beverages and tobacco (-0.1%).
Uzir also said the July core index rose 0.7% year-on-year due to higher costs of furnishings, household equipment and routine household maintenance (1.7%), food and non-alcoholic beverages (1.1%) and transport (1%).
Core index covers all goods and services except volatile items of fresh food as well as administered prices.
The CPI without fuel increased by 0.8% in July 2021 to 113.2 from 112.3 a year ago. The index without fuel covers all goods and services except unleaded petrol RON95, unleaded petrol RON97 and diesel.
The Statistics Department pointed out that five states recorded higher inflation rate when compared with the national rate of 2.2% in July.
The states are Terengganu (2.8%), Pahang (2.5%), Selangor and Putrajaya (2.4%), Kelantan (2.4%) and Sarawak (2.3%) due to higher costs of food and non-alcoholic beverages.
Separately, the Statistics Department also announced that Malaysia’s Leading Index (LI) fell by 2.8% in June from a month ago while the Coincident Index (CI) slowed down further, pointing out to a slower economic growth in the coming months.
It said the month-on-month decline was reflected by the reduction in all of the LI components, mainly the number of housing units approved (-0.9%).
The LI is a predictive tool used to anticipate economic upturns and downturns in an average of four to six months ahead.
Uzir said that on a year-on-year basis, the LI continued to register a positive growth of 0.5% to 105.6 points in June 2021 from 105.1 points a year ago.
“The increase was mainly contributed by real imports of other basic precious and other non-ferrous metals driven by the import of copper-based metals.
“However, the LI declined 2.8% month-on-month,” he said, adding that looking at the direction indicated by the decreasing growth rate of smoothed LI despite remaining above the trend, “the LI indicates that Malaysia’s near-term economic prospect continues to face challenges”.