The Department of Statistics Malaysia (DOSM) reported Malaysia’s inflation rate rose by 1.3% in August 2025, with the Consumer Price Index (CPI) standing at 134.9 points compared to 133.2 points a year earlier. The latest figures highlight both upward and downward trends across different sectors, shaping a mixed picture of price pressures faced by consumers.
The increase was mainly fuelled by higher costs in several categories. Insurance and financial services recorded the sharpest rise at 5.6%, reflecting greater household spending in protection-related areas.
Personal care, social protection and other miscellaneous goods and services followed with a 4.0% jump, while restaurants and accommodation services increased 3.5%, pointing to continued demand for dining and leisure activities.
Education costs rose 2.4%, while the food and beverages category grew 2.0%, adding to everyday living expenses. Smaller gains were also observed in recreation, sport and culture (0.9%) as well as household furnishings and maintenance (0.2%).
In contrast, several groups posted slower increases than the previous month. Housing, water, electricity, gas and other fuels rose 1.2%, health services edged up 1.1%, while alcoholic beverages and tobacco rose 0.4%.
Transport costs registered a more modest increase of just 0.2%, offering some relief to households. Notably, two categories remained in negative territory, information and communication fell sharply by -5.6%, while clothing and footwear dipped slightly by -0.1%.
The food and beverages segment, which makes up nearly a third of Malaysia’s CPI basket, showed a mixed trend. Food consumed away from home, such as dining in restaurants, held steady with an increase of 4.3%, underscoring the persistent popularity of eating out. However, food at home slipped into negative growth of -0.1%, hinting at some price relief in grocery purchases.
Inflation was not uniform across the country. Ten states recorded inflation below the national average of 1.3%, with Kelantan posting the lowest at just 0.1%. On the other hand, Johor registered the highest increase at 2.0%, followed by Selangor and Terengganu at 1.5% each, and Negeri Sembilan at 1.4%. This variation highlights how regional economic dynamics continue to shape consumer price trends differently across states.
On a month-to-month basis, headline inflation edged up 0.1% compared to July 2025. The rise was mainly attributed to higher prices in information and communication (0.8%) and restaurant and accommodation services (0.4%). Smaller increases were also recorded in housing, education, recreation and personal care, which each grew 0.2%.
Core inflation, which excludes volatile items such as fuel and certain foods, increased to 2.0% in August from 1.8% in July. The rise was largely driven by insurance and financial services, personal care, food and beverages, as well as restaurant and accommodation services.
When compared with other countries in the region, Malaysia’s inflation remains relatively contained. At 1.3%, it was lower than Viet Nam (3.2%), Indonesia (2.3%) and South Korea (1.7%). However, it was still higher than Thailand (-0.8%) and China (-0.4%), both of which experienced deflation.
Overall, the August 2025 figures suggest that Malaysia continues to experience moderate inflationary pressure. Rising costs in services and lifestyle-related spending remain a key factor, while grocery and transport prices help cushion households from steeper increases. Policymakers will be keeping a close watch on these mixed sectoral trends to ensure price stability and safeguard consumer purchasing power in the months ahead.
For more detailed statistics and updates, visit the official website of the DOSM.
Shahriena Shukri is a journalist covering business and economic news in Malaysia, providing insights on market trends, corporate developments, and financial policies. More about Shahriena Shukri.
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