Malaysia’s consumer price index (CPI) climbed 1.6 per cent in December 2025, according to the latest figures released by the Department of Statistics Malaysia (DOSM), indicating continued moderate inflation at the close of the year.
📊 What’s Driving the Increase?
The CPI, which measures changes in the price of goods and services commonly bought by households, reached 135.5 points in December 2025, compared with 133.4 points a year earlier.
Economists point out that the rise was mainly supported by higher costs in personal care, social protection, and miscellaneous goods and services — categories that have picked up gradually following supply and demand shifts in the economy.
📉 Inflation Still Below Historical Trends
Despite the uptick, inflation remains subdued, sitting below the 10-year average trend of 1.8 per cent. Sunway University economics professor Dr Yeah Kim Leng noted that this suggests price pressures are contained and within normal fluctuation ranges.
Overall, Malaysia’s annual inflation for 2025 registered 1.4 per cent, lower than the 1.8 per cent recorded in 2024 — reflecting a period of relative price stability.
🧠 Expert Views on the Economy
Analysts have highlighted a mix of factors shaping inflation trends:
- Monetary policy effects: Bank Negara Malaysia’s gradual raising of the overnight policy rate (OPR) — from 1.75% in 2022 to 3.00% in 2023 — is credited with helping moderate inflation.
- External influences: Lower crude oil prices have helped contain broader cost increases across food and non-food sectors.
- Future outlook: With businesses passing on costs to consumers and demand-pull pressures building, some economists expect upward inflation pressure in 2026, though still at moderate levels.
💡 What This Means for Malaysians
A relatively stable inflation rate has important implications:
- Household purchasing power is likely to remain resilient, supported by moderate price rises.
- Wage adjustments and cash assistance programmes from the government may help maintain consumer confidence.
- Businesses and investors can plan with greater certainty amid contained price movements.