Inflation Rate In Malaysia
Inflation is the biggest enemy for those who do consistent savings. Inflation make our money less value and thus decrease our buying power. You can buy less thing with RM5 today compare to ten years ago. Using daily consuming food as example, we can have two plates of mee with RM5 ten years ago but today we can buy less than two plates. This is inflation!
After some research, finding that there are two inflation rates need to take into consideration. It can be based on Consumer Price Index (CPI) from our government and our own buying index.
Inflation rate based on CPI can be calculated by deducting the past year CPI with present CPI divide by past year CPI and multiply by 100. Confusing? I guess so, please refer to the formula below.
Inflation rate calculation
Some people might find that inflation rate declared by government is not accurate as they tend to lower the inflation rate to reflect the economy health of our nation. That’s why we need our own inflation rate based on our ‘buying index’. We need to list up the sum used to buy goods for present year and pass year in order to calculate our own inflation rate by using the same formula above.
Based on the print screen from Indexmundi.com, our 2008 inflation rate is merely 2%. How true is it?
can you send me more information about inflation?
thank you.
and i like to ask about it is every year we lost 3%-5% of our buying power?
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