The Muamalat Newsletter Vol.1 2023

FEM Newsletter | June 2023 44 References: Braun, P. (Oct. 29, 2021). Why The Inflation Picture Remains Clouded And What Business Leaders Need To Know. Forbes. Retrieved on Jan. 15, 2021 from <https://www.forbes.com/sites/phil- lipbraun/2021/10/29/why-the-inflation-picture-remains-clouded-and-what-business-lead- ers-need-to-know/?sh=1e8ce7977b35> Carnell. R. (March 2, 2023). A Last Hurrah for Asian Inflation. Retrieved on March 28, 2023 from <https://think.ing.com/articles/last-hurrah-for-asian-inflation > Dinerstein, C. (March 22, 2022). Every Picture Tells A Story: Inflation Has Uneven Effects. Retrieved on March 28, 2023 from < https://www.acsh.org/news/2022/03/22/every-picture-tells-story-in- flation-has-uneven-effects-16197> Oxford Economics. (Dec. 12, 2022). Services inflation to take centre stage in 2023. Retrieved on March 28, 2023 from < https://www.oxfordeconomics.com/resource/services-inflation-to- take-centre-stage-in-2023/> Popli, N. & Burga, S. (Jan. 28, 2023). Here’s Why So Many Grocery Store Staples Are So Expensive Right Now. Retrieved on March 28, 2023 from <https://time.com/6250895/grocery-prices-ris- ing-inflation/> Srinivasan, K., Helbling, T. & Peiris, S.J. (Feb. 20, 2023). Asia’s Easing Economic Headwinds Make Way for Stronger Recovery, IMF Blog, Retrieved on March 23, 2023 from <https://www.imf.org/en/ blogs/articles/2023/02/20/asias-easing-economic-headwinds-make-way-for-stronger-re- covery> processing and packaging for beef and frankfurter add to rising costs besides rising wages and a shortage of labour and general spikes in the costs to transport goods. In the case of vegetables and fresh fruits dry weather conditions and an insect- borne virus have damaged crops in certain areas and rainy weather contributed to price increases. Shopping experts suggest shopping at different stores to have better deals, using discount coupons, using credit cards that offer membership rewards, limiting food waste, and choosing non- name brand goods or buying non-perishable goods in bulk. According to Elaine Schwartz, the Boomers, the older generation, spend more on health care while Gen Z (born 1997-2012) spends more on education. Meanwhile, for people in their 20s and 30s, gasoline, is one reason for higher transportation spending. Generations that have experienced inflation may worry about inflation in the future. This means Gen Z and the new baby boomers will become inflation worriers. Conclusions With a mixed bag of reasons for inflation, no one policy could solve the problem at present. According to Oxford Economics Research Briefing, services inflation is important to balance out the rise in goods inflation. The policy rates should monitor the development in services inflation since it is the CPI component that is most closely linked to domestic economic conditions. High services inflation indicates supply chain bottlenecks and the passthrough of energy and food prices increase onto components such as restaurant meals. In addition, high service inflation could be a sign that the economy is overheating. The outlook of inflation is still uncertain given the current global situation. Will prices rise at stay at elevated levels? It depends on several factors. One of the most important ones is the severity of the pandemic and the containment measures undertaken. Without the COVID-19 pandemic, the surge in inflation seems highly unlikely, but the pandemic has created a combination of both demand- pull and cost-push inflation. The current situation presents a good historical study of inflationary pressure at the global level. To fight inflation, the authority should continue to monitor the overall price increases and communicate policy directions clearly to the public so that expectations remain anchored. Acknowledgement The research is funded by Universiti Sains Islam Malaysia Research Grant (Research Code: PPPI/FEM/0121/USIM/15121). Author’s email: nursilah@usim.edu.my