Chief economist Suhaimi Ilias said it has also raised its inflation rate projection for 2023 to 4.1% from 2.5%.

“This is because we have incorporated the higher prices of food items like chicken and cooking oil starting July this year following the higher ceiling price for standard whole chicken.

“(Plus) the removal of price subsidy for bottled cooking oil, as well as on the assumption of a fuel subsidy review next year,” he said in a statement today.

Suhaimi noted that to mitigate the immediate cost-of-living impact of the food and fuel inflation, the government announced that there would be no hike in the power and water tariffs in Peninsular Malaysia for the second half of this year as well as an additional allocation of RM630 million under the Bantuan Keluarga Malaysia cash assistance.

The overall inflation accelerated to 2.8% year-on-year (y-o-y) in May 2022 from 2.3% y-o-y in April.