How to Combat Inflation

Recommendations Based on the results gene enjoind from the multiple regression analysis of this research, thither are few recommendations that can be implemented to combat the flash in Malaysian economy. The recommendations are 1. Malaysia government should focus on producing exporting goods than importing goods from other countries in order to encourage appreciation of Ringgit Malaysia money value. In turn, it willing decrease the inflation commit and trigger the purchase power to other currencies namely, dollar, euro and pound. This is because countries with high inflation rate will own depreciation in their currency.However, even though the ringgit appreciation can geld the import prices, consumers may not able to get the benefit from the reduction. check to Central Bank, the vigorous appreciation of ringgit currency can slow raze the export competitiveness that can directly impact income and weaken internal demand. 2. GDP and CPI is directly impact each other. Income i s adjusted tally to the CPI level. In order to burn the inflation rate, government should varan the growth of GDP. If GDP is increase too fast, CPI also will increase too fast and subsequently, increase the cost of living.In addition, the government is bumper-to-bumper than the market, making it almost impossible for government to keep up with the income adjustments mandatory to provide good quality of life to Malaysians. 3. It is Central Bank duty to decide the most appropriate deposit rate to be obligate on the money savers. One of the ways to reduce the inflation rate in Malaysia is by increasing the deposit rate so that hoi polloi will save more and spends less. Increase in deposit rate can discourage borrowing, and somehow reduce the consumer spending and consequently reduce the inflation rate.