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Malaysia's PPI Declines 2.4% In October, Led By Mining And Manufacturing Deflation

Business Today ·  Nov 28, 2024 01:05

Malaysia's Producer Price Index (PPI) fell 2.4% year-on-year (yoy) in October 2024, continuing its decline from a 2.1% contraction in September, according to the Department of Statistics Malaysia (DOSM). The drop was primarily driven by a 17.3% yoy deflation in the mining sector, with crude petroleum prices falling 21.7% and natural gas down 1.7%. The manufacturing sector also saw a sharper contraction of 2.6% yoy, led by a 21.6% drop in the manufacture of coke and refined petroleum products as reported by MIDF Amanah Investment Bank Bhd (MIDF Research).

In contrast, the agriculture sector recorded inflation of 13.8% yoy, buoyed by a 24.3% increase in perennial crops. The water supply industry showed inflation of 6.9%, while the electricity and gas supply index rose by 0.8%. By stage of processing, prices of primary goods fell 8.4% yoy, while intermediate materials and components contracted by 1.9%. Finished goods, however, rose by 1.1% yoy.

On a monthly basis, the PPI fell 0.7% in October, easing from a 1.5% decline in September. MIDF Research expects Consumer Price Index (CPI) inflation to remain stable in the near term, with local producers facing less pressure to raise prices due to easing cost conditions. However, food price inflation is anticipated to rise, influenced by adverse weather and increased crude palm oil prices.

Disclaimer: This content is for informational and educational purposes only and does not constitute a recommendation or endorsement of any specific investment or investment strategy. Read more
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