Remained stable at 2.0% YoY in June despite a sharp increase in diesel prices
The headline inflation rate remained unchanged at 2.0% YoY in June, marginally exceeding both the house forecast and market consensus of 2.2%, due to the limited impact of diesel subsidy rationalisation
- Despite a substantial 41.9% MoM increase in diesel price on average in June, the transport component rose by only 0.5% MoM, partly due to the low diesel CPI weight. While not as high as expected, this still contributed to inflationary pressure, alongside higher food and services prices.
- On a MoM basis, headline inflation slowed to 0.15% (May: 0.30%), mainly driven by muted housing costs (0.0%; May: 0.6%) and a drop in miscellaneous prices (-0.1%; May: 0.3%).
- Core inflation remained unchanged at 1.9% YoY (May: 1.9%) but moderated by 0.1% MoM (May: 0.4%), due to a drop in core transport cost.
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