OctaFX: August inflation data may give more power to the ringgit

Published : Thursday, September 21, 2023, 4:57 pm
ACROFAN=Jae-Yong Ryu | | SNS
The Department of Statistics Malaysia (DOSM) will release monthly inflation data on 22 September. OctaFX experts suggest that August's annual consumer inflation will likely remain at 2.0%.

According to official data released last month, Malaysia's annual inflation rate slowed to 2.0% in July from 2.4% in June. Lower inflation rates were recorded in Food and non-alcoholic beverages (4.4% in July from 4.7% in June) and Restaurants and hotels (5.0% in July from 5.4% in June). Overall, Malaysia's inflation rate of 2.0% was lower than that of neighbouring regions, with July inflation in Indonesia, the Philippines, and Singapore standing at 3.1%, 4.7%, and 4.1%, respectively.

The Central Bank of Malaysia is satisfied with the reduction in inflation and kept its benchmark interest rate unchanged at the last monetary policy meeting as economic growth and inflation continued to ease.

'We see the continued growth of the Malaysian economy,' said Kar Yong Ang. 'With low consumer inflation and a signal from Malaysia's central bank that the ringgit continues to demonstrate its strength, we tend to assume that USDMYR will decline towards 4.520 and possibly lower,' he added.

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