Wednesday, July 23, 2008

CPI for June surges to 7.7%

UPDATE 6.30 a.m. July 25: Reading the report High inflation rate pressures BNM to raise rates so soon after that release of information on the CPI numbers for June, 2008 tells me 2 things. First, Bank Negara and the government machinery had intended all along to increase interest rates. They are careful to manage mindsets by releasing alarming CPI numbers first and, then, announce interest rate increases. Second, the federal govt has learned from the fuel price increase debacle to be careful in managing mindsets and conceal their true intent by deflecting attention; in this case, the strategy is tell the rakyat some very bad news on inflation, then slip in the increase in interest rates.
All that is par-for-the-course, all govts do that. The question that I hope real economists can help to answer (I'm only an armchair one!) is, how the federal govt can manage consumer price inflation using interest rate hikes. Can anyone help enlighten us?
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Read the Star Online on CPI for June surges to 7.7%. This, more realistic, indicator comes after the government admitted that the Malaysian CPI does not accurately reflect the correct mix of consumer goods; see Malaysia reviews consumer price index amid criticism it doesn't accurately measure inflation.
As certain PAS factions continue their talks with UMNO about Malay unity, Malaysians, especially those families earning RM3,000-00 a month, or less, are UNITED in facing the precipice of desperate financial straits.
So, which is more important? Most Malaysians know the answer, but some Malaysian politicians think the other issue is more important.

5 comments:

ben said...

Watch the banks' NPLs especially those with exposure to SMEs and hirepurchase.

For HPs the repayment is fixed and hence, they can't cut down like lifestyle. Those buyers of Protons and Peroduas are the most vulnerable because majority of them would just borrow from 95% to 100%. They rather let the banks repossess the car.

It'll get worse before it gets better.

In spite of the crisis, all the BN gomen can up with is piecemeal approach. Now even Dr M is saying that the 41% fuel hike is too much a shock to the economy. Now we're feeling the after effect.

The sooner the BN govt start listening to their thinktanks [NEAC, Bank Negara, not EPU becos they protect concessionaire rather than rakyats. Look at IPP, Toll,Water] and not interfere with their work the better for Malaysia!

CT Choo said...

By the way, EPU and NEAC has the same boss, whats-his-name? The guy who said civil servants shld get 2nd jobs? Oh! "Moonlighting" Amirsham is his name. Maybe the "gomen" shld listen to blogger flers like us!

ben said...

The saying, 'there is no free lunch' is not quite 100% true. Here we're (bloggers, I am not one but kay-po sikitlah) churning out constructive suggestions, especially people like you, all in the name of national service for the love of our nation.

Guess what we get from the gomen, SCREWED further!

Where's the bloody PR shadow cabinet. These are bullets for them. I think you should write a stinking one about shadow cabinet because I think they're still fighting shadow!

CT Choo said...

I agree with you. Certain PR MPs have become a little bit self-indulgent. Just look at some of their blogs. Instead of blogging about issues they blog about their parties, weddings, love of animals... Oi! Do that in a personal blog or direct us to the MP blog. Don't mix the two. It's very annoying and disappointing. We know the MPs have their personal lives. But, hello!, we're not interested. Channel E! is already very good, thank you!

Anonymous said...

When price of oil goes up by 41%,the price of almost everything goes up.But our CPI is just 7.7%.I don`t know which economist did the calculation. I was made to understand that there is just a thing as a `consumer basket` of essential goods.But,I am not sure if things like Dodoi , Chondoi , Lengkong , goreng pisang , Kui tupat are in the basket just to bring down the average CPI? If they are, please take them out.My experience tells me that the CPI should be much higher.