According to Business Times, CPI or Consumer Price Index rose at 2.5%.
Consumer Price Index is an indicator of the rate of inflation in the economy because it measures changes in the cost of maintaining a particular standard of living.
Here are other important points I would like to indicate:
- Food price – cooking oil, chicken, and sugar, will remain high and will get higher. High Demand with Short Supply pushes price to go up. Smuggle activity will increase.
- Transport cost soars up since toll rate will escalate from 7.7% to 50% on six highways.
- The rising inflationary pressure in 2008 would soften Bank Negara Malaysia’s bias towards monetary easing unless the economic growth trend falters.
- Government could fight inflation by adopting a tighter policy stance although this risks dragging economic growth down further.
Further reading, 2008 CPI seen rising at minimum pace of 2.5pc