INFLATION RATE EXPECTED TO MODERATE, SAYS MINISTER

PUTRAJAYA, Jan 22 (Bernama) -- The inflation rate is expected to moderate
further this month due to the low fuel price, Domestic Trade and Consumer
Affairs Shahrir Abdul Samad said Wednesday.

He said the fuel price was the most significant factor contributing to the
decline with the latest reduction in petrol and diesel prices.

"The fuel price is the most significant factor. Still at 1.80 per litre, it
is lower than the price of RM1.92 for the same period in 2007," Shahrir said.

"It will not cause any increase in prices. In fact, it will help in
maintaining a stable environment. I think the more important thing is that the
price environment is more stable," he told reporters after announcing the
Consumer Price Index (CPI) for December 2008.

Shahrir said at the same time, the government's price reduction campaign
will continue and he anticipated that there will be changes in the price level
of some commodities and lower prices of inputs.

"This will be getting into the system to realise in lower prices for some of
the food items and you will see some price reductions in the first quarter (of
the year)," he said.

Asked about the forecast for 2009, Shahrir said various financial bodies
have projected inflation rates averaging 2.39 percent for this year.

"It ranges from JP Morgan forecasting for 2009 at 0.3 percent to 3.5 percent
as forecast by Kuwait Finance House. So, the average forecast for 2009 by the
financial sector is 2.39 percent," he said.
-- BERNAMA