Malaysia’s inflation may hit double digits: Finance Minister
Finance Minister Zafrul Aziz has said Malaysia's inflation may reach around 11% if the government does not implement subsidies for essential items like fuel.
Finance Minister Zafrul Aziz has said Malaysia's inflation may reach around 11%. (Photo: theedgemarkets.com)
Kuala Lumpur (VNA) – Finance Minister ZafrulAziz has said Malaysia's inflation may reach around 11% if the government doesnot implement subsidies for essential items like fuel.
The minister told the press that Malaysia'sinflation is forecast to be 2.2%-3.2%. In fact, for the first six months of theyear, inflation was around 2.5%, and that was largely due to the large size ofsubsidies that the government introduced.
Malaysia's inflation, as measured by the consumerprice index, increased 3.4% year-on-year in June, led by costlier food, theDepartment of Statistics Malaysia said on July 22.
Nonetheless, Tengku Zafrul acknowledged that thecurrent blanket subsidy policy is not sustainable for the country, but it isnecessary for economic recovery in the short term.
The government is managing the economy cautiously,and the monetary policy has been further tightened, he said.
In terms of economic growth, Tengku Zafrul saiddespite the US economic slowdown, the Malaysian government is still optimisticabout recording GDP growth in 2022 due in part to low base effect and economicreopening.
However, he cautioned that the challenge lies in2023, when asked whether Malaysia could avoid a recession given that thecountry is an open economy with an estimated 120% trade-to-GDP ratio./.
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Finance Minister Zafrul Aziz has said Malaysia's inflation may reach around 11%. (Photo: theedgemarkets.com)
