KUALA LUMPUR, July 29 (Bernama) -- Bursa Malaysia rebounded to close higher on Wednesday on selective buying of defensive stocks after a volatile trading session. IPPFA Sdn Bhd director of investment strategy and country economist Mohd Sedek Jantan said consumer products and services stocks lifted the key index higher, overcoming lingering geopolitical concerns. At 5 pm, the FTSE Bursa Malaysia KLCI (FBM KLCI) rose 3.08 points to 1,715.56 from yesterday’s close of 1,712.48. The benchmark index, which opened 1.91 points higher at 1,714.39, moved between 1,710.79 and 1,720.59 during the day’s trading. In the broader market, gainers outstripped decliners 550 to 476, while 612 counters were unchanged, 1,129 untraded, and 48 suspended. Turnover rose to 2.96 billion units valued at RM2.48 billion from 2.94 billion units valued at RM2.56 billion on Tuesday.
South Korea's consumer inflation has cooled more than anticipated in September, dipping below the central bank's target for the first time since early 2021. This development is fueling expectations of an imminent policy easing.
The consumer price index (CPI) rose 1.6% in September compared to a year earlier, following a 2.0% increase in August, according to data from Statistics Korea released on Wednesday. This figure is lower than the median forecast of a 1.9% increase from a Reuters poll of economists and represents the weakest annual increase since February 2021.
The CPI reading is now below the Bank of Korea's (BOK) medium-term target of 2% and coincides with growing discussions among policymakers and market participants about a potential interest rate cut ahead of the next policy meeting scheduled for October 11.
In response to the inflation data, South Korea's policy-sensitive three-year treasury bond yield fell by 3.4 basis points to 2.777%, marking the lowest level since April 2022.
Both Finance Minister Choi Sang-mok and BOK Deputy Governor Kim Woong noted that the trend toward price stabilization is ongoing. Ahn Jae-kyun, a fixed-income analyst at Shinhan Securities, commented, "The data once again backed the case for rate cuts." He anticipates that the BOK will lower interest rates next week.
Historically, the BOK has lowered interest rates after seeing inflation drop to the 1% range from 2%. However, Ahn highlighted that the current situation is complicated by high household debt levels and the central bank's cautious stance regarding financial stability.
In its last meeting in August, the BOK maintained interest rates at a 16-year high of 3.50%, despite the deceleration in inflation and domestic demand, due to concerns over financial stability risks linked to a robust housing market.
On a monthly basis, the CPI rose 0.1%, slower than the 0.4% increase recorded in the previous month and below economists' expectations of 0.3%. The prices of petroleum products fell 4.1%, while private services decreased by 0.4%, counterbalancing increases in agricultural products and public utilities.
Additionally, the core CPI, which excludes volatile food and energy items, rose 2.0% year-on-year, a deceleration from the 2.1% increase in the previous month and marking the slowest growth since November 2021.
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