Malaysia's inflation may just make a U-turn in 2013

It's likely to sit around 3% from this year's 2%.

According to OCBC, Malaysia’s GDP may inch up to 5.2% in 2013 from the firm's projection of 5.1% in 2013, with uncertainties linked to the upcoming general elections and export growth from commodity price correction keeping our forecasts relatively conservative. On the upside, the strong momentum in investment growth and private consumption should continue into 2013.

"Inflation may return to its medium-term inflation trend of about 3.0% yoy in 2013 from below 2.0% yoy this year. With risks from the growth-inflation fronts fairly balanced, we expect the BNM to maintain its key OPR policy rate steady at 3.0% in 2013," OCBC added.

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