Inflation up by 3.3%, the people continue to be burdened

KUALA LUMPUR, 2 Aug: The rate of inflation rose to 3.3 percent in June 2014 compared to 3.2 percent the previous month.

In a statement, Bank Negara Malaysia (BNM) said that food and non-alcoholic beverages recorded higher inflation at 3.5 percent (May, 3.3 percent) especially due to the increase in prices of fish, seafood and vegetables.

Inflation in the category of alcoholic beverages and tobacco reduced to 11.6 percent (May, 14.1 percent) dues to the base effect following the increase in tobacco price in June 2013, which has expired.


Meanwhile, market expectations that the Overnight Policy Rate (OPR) which was raised in July contributed to the interbank rate that is higher for the maturity period of one moth or more.

In terms of retail lending rates, the base lending rate (BLR) average of commercial banks remained unchanged at 6.53 percent in June, while retail deposit rates were also relatively stable during the period.

Following the decision by the Monetary Police Committee (MPC) to raise the OPR by 25 points to 3.25 percent on July 10, 2014, the interbank rates for the period of maturity became higher. Retail lending rates and retail deposit rates have also been increased.

BNM on the exchange rate and international reserves, in June, showed the ringgit depreciating against most currencies of Malaysia’s major trading partners.. However, the ringgit remained relatively unchanged against the US Dollar.


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