Tuesday September 09, 2008

Malaysia inflation rate hit 8.5% in July 2008, a new 26-year record high

This article belongs to the Malaysia inflation watch story arc.

dailytimes.com.pk :

Malaysia's inflation rate rose to a new 26-year high of 8.5% in Jul 2008, driven higher by the escalating cost of fuel and electricity, according to official data. The result was substantially higher than expected, increasing pressure on the central Bank Negara to raise interest rates. Malaysia's government hiked the fuel price by 41% in June, in a move to rein in the ballooning cost of subsidies. High inflation was one of the factors that led to an unprecedented humiliation at March general elections for the ruling coalition, which lost five states and a third of parliamentary seats.

- With just one and a half percentage points to go, it looks like Malaysia is on its way to hitting double-digit inflation rates. In terms of historical timing, it has come up from behind to match and even exceed Singapore's 26-year inflation record high of 7.5%. The next countries to contend with in the Asian region are Thailand (9.2%), India (12.63%), and there's always Vietnam (27%). If this sounds like a race, that's because it is, in a twisted sort of way. It's a race to the bottom - the winner is the country that manages to inflate its currency into oblivion, and the prize is economic misery, at least until the government eventually figures a way out of it. Which could take some time.

See also :

1. Fuel prices seen stoking Malaysia inflation in 2008
2. Angry citizens protest as Malaysia eliminates subsidies, raising petrol prices 40% overnight
3. Malaysia inflation rate could hit 9-year high of 5% on petrol and diesel price hikes
4. Malaysia inflation rate jumps to 7.7% in Jun 2008, a 26-year record high

(2008-09-09 10:50:46 SGT) [Biz] Permalink

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