Malaysia’s annual inflation is expected to have accelerated to 1.8% in May, gaining from the previous month, according to a Reuters poll of nine economists on Tuesday, Reuters reported. Inflation likely rose on higher prices for fuel and food, the survey respondents said. The Muslim holy month of Ramadan began in mid-May this year, pushing up food consumption as devotees break-day long fasts with communal feasting. The inflation rate was 1.4% in April on the back of higher food costs, but came in lower than expected on steady fuel prices. Malaysia’s central bank had left its key interest rate unchanged in its last review on a lower inflation rate and steady economic growth, after the country’s former ruling coalition was ousted in a shock election upset. Meanwhile, RAM Rating Services Bhd says, Malaysia’s headline inflation rate for May is expected to increase from 1.4% to 1.9%, primarily due to faster growth in retail fuel prices. The increase in retail fuel inflation of 5.1% in May, compared with the 0.3% contraction in April, was for the most part attributable to a low base effect.
