KUALA LUMPUR (May 27): Bank Negara Malaysia (BNM) Governor Tan Sri Dr Zeti Akhtar Aziz said the increase in inflation rate to 1.8% in April was within expectation.

Malaysia’s consumer price index in April rose to 1.8% from a year earlier, as the effects of the goods and services tax implementation kicked in.

“April’s inflation of 1.8% was pretty much priced in, [it was lower before] due to the decline in oil and other commodity prices in the beginning of the year," she told reporters after a luncheon power talk in conjunction with the Asean Small and Medium Enterprise (SME) Showcase and Conference 2015 organised by SME Corp Malaysia today.

“Inflation is expected to be in the range of 2% this year,” she added.

On concerns expressed by the SMEs in obtaining credit, the governor said credit growth in the banking system is still strong.

“We are still having strong credit growth, expanding at a rate of 9%. Those [SMEs] that are facing challenging conditions should discuss with their respective banks, and these banks should highlight to them how they can be eligible [for credit],” said Zeti.