MALAYSIA'S ECONOMIC FUNDAMENTALS STRONG FOR ROBUST GROWTH DESPITE INFLATION THREAT

KUALA LUMPUR, Sept 9 (Bernama) -- Malaysia's economic fundamentals have
remained strong for a robust long-term growth but similar to other East and
South-East Asian countries, rising inflation could be a near-term stumbling
block, says the United Nations Economic and Social Commission for Asia and the
Pacific.

Malaysia’s inflation rate stood at 3.4 per cent in July compared with
June’s two-year high of 3.5 per cent.

"Although the country has a relatively lower inflation than other countries
in South-East Asia, a surge in short-term capital inflows, rising oil and food
prices as well as the pressure of accelerating demand will continue to drive
inflation," said the Bangkok-based commission.

Last month, Prime Minister Najib Tun Razak had said that the
government was confident the nation’s gross domestic product will expand between
five and six per cent this year despite the volatile global economy.

On inflation, he said it was still manageable.

Bank Negara Malaysia (central bank) announced that the pace of growth of
Malaysia’s
economy moderated to four per cent in the second quarter this year from a
revised growth of 4.9 per cent in the first quarter.

On Friday, the central bank announced that it was maintaining the
Overnight Policy Rate (OPR) at 3.00 per cent as global growth had moderated in
recent months with advanced economies slowing down by more than expected
following greater policy uncertainties.

-- BERNAMA