Awaiting CPI Report

Spot USD/MYR trades flat at MYR4.4060 as onshore markets re-open. This week has seen the rate respect a familiar range around the MYR4.4000 figure. Bulls need to see a breach of Jun 14 high of MYR4.4255 before setting their sights on Mar 23, 2020 high of MYR4.4490. Bears would be pleased by a slide through Jun 17 low of MYR4.3945, which would bring May 31 low of MYR4.3643 into play.

• CPI data headlines the domestic docket today. Headline inflation is expected to have quickened to +2.7% Y/Y in May from +2.3% prior, according to Bloomberg consensus forecast. As we await the release, Malay Mail released its alternative gauge of consumer price inflation reflecting differences in spending patterns. The CKI (Cik Kiah Index), captures goods purchased by a typical bottom-40% (B40) household. In the period between April 2021 - April 2022, it grew at an average rate of 3.3% Y/Y, which was 1pp higher than CPI growth.
• In political news, the Straits Times reported that the Election Commission has started logistical preparations for the next general election.
• Elsewhere, Health Minister Khairy warned that a new wave of COVID-19 is expected to come earlier than expected in the next two to three months.