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Malaysia rejects Standard Chartered's higher inflation forecast
Bloomberg - 15 Jan 2008
Malaysia rejected a forecast by Standard Chartered Bank Plc for the nation's inflation rate to almost double in 2008, saying the government can keep price increases at current levels. Standard Chartered said yesterday inflation will average 4 percent in Malaysia this year as food and fuel costs climb. Prices in the Southeast Asian nation rose 2.3 percent in November, the quickest pace in nine months, the government said last month. ``At this point in time, I don't see inflation going up to 4 percent,'' Malaysian Second Finance Minister Nor Mohamed Yakcop told reporters today in Putrajaya, outside Kuala Lumpur. ``The government has been able to contain inflation.'' Malaysia's government spent about 35 billion ringgit ($11 billion) keeping gasoline and diesel under the market price last year, and controls the cost of foods such as eggs, flour and cooking oil. Still, a pledge not to increase fuel prices expired in 2007, and many economists expect a tariff increase at the pumps to drive the inflation rate higher this year. Nor said he expects inflation to be between 2 percent and 2.5 percent for the next six months to a year