Petronas Twin Towers near skyscrapers and trees under a blue sky in Kuala Lumpur, Malaysia
KUALA LUMPUR: Malaysia’s Producer Price Index (PPI), which measures the prices of goods at the factory gate, declined by 0.3 per cent year-on-year (y-o-y) in October 2023 after recording a 0.2 per cent growth in September, the Department of Statistics Malaysia (DoSM) said.
Chief statistician Datuk Seri Dr Mohd Uzir Mahidin said the decline was mainly due to the manufacturing sector’s PPI, which contracted by 0.7 per cent last month (September: -0.8 per cent).
"Subsectors that contributed to the decrease were the manufacture of coke and refined petroleum products (-8.8 per cent), manufacture of food products (-4.2 per cent) and manufacture of chemicals and chemical products (-2.0 per cent),” he said in a statement.
Apart from the manufacturing sector, the electricity and gas supply index also dropped by 0.5 per cent, he added.
Meanwhile, the agriculture, forestry and fishing sector recorded a 3.8 per cent y-o-y growth (September 2023: 3.2 per cent) due to the increase in the animal production index (4.3 per cent) and growing of perennial crops index (3.8 per cent).
The mining sector also recorded a slight increase of 0.5 per cent in October 2023 as opposed to 6.9 per cent in the previous month, supported by the extraction of crude petroleum index (5.6 per cent).
On a month-on-month basis, the PPI - local production decreased by 0.3 per cent in October 2023 after recording a 0.9 per cent increase in the previous month.
Commenting on the Middle East conflict, Mohd Uzir said the series of extraordinary shocks has raised geopolitical risks for the commodity markets amid an already volatile global landscape.
"Before the conflict erupted, based on the World Bank's commodity price index, energy prices during the third quarter of 2023 went up due to voluntary oil supply cuts by the Organisation of the Petroleum Exporting Countries producers.
"Up to this point, however, the war's impact on commodity prices has been muted. Oil and gold prices may have increased slightly, but most commodity prices have stayed relatively stable,” he said.
However, he said, history suggests an escalation of conflict poses a major risk to commodity prices, as it could send prices of oil and other commodities soaring.
According to the baseline forecast from the World Bank’s Commodity Markets Outlook report for October 2023, commodity prices are expected to decline modestly over the next two years, Mohd Uzir said. - Bernama
