KUALA LUMPUR (July 22): A sharper drop in food-at-home prices helped ease Malaysia’s headline inflation in June, bringing it to the lowest level in more than four years, official data released on Tuesday showed.

According to the Department of Statistics Malaysia (DOSM), the consumer price index, Malaysia’s main gauge of inflation, rose just 1.1% year-on-year (y-o-y) in June 2025 — slightly lower than  May's 1.2% and a Bloomberg survey of economists that had predicted a median 1.2% increase. 

The moderation was mainly driven by a 0.4% y-o-y decline in the food-at-home category, compared with no change in May. Among the biggest contributors were vegetables (down 7.2%), eggs (down 4.4%) and chicken (down 0.6%). 

Meanwhile, transport inflation slowed to 0.3% from 0.7% in May, amid a notable 3.4% drop in diesel prices, compared with an increase of 12.4% in the previous month.

Core inflation, which excludes volatile food and fuel items, remained unchanged at 1.8% from a month ago.

“The slowing down was also reflected by the decline in producer price index (PPI), local production registering negative 3.6% in May 2025 (April 2025: -3.4%),” said chief statistician Datuk Seri Dr Mohd Uzir Mahidin in the statement.

While dining out became marginally more expensive, with food-away-from-home rising 4.7% in June versus 4.4% in May, this was moderated by more stable housing and utility costs, which increased at the same rate of 0.6% as recorded in the previous month.

Across the states, Kelantan recorded the lowest inflation at 0.2%, while Negeri Sembilan and Selangor saw the highest increases at 1.6%.

On a quarterly basis, inflation in the second quarter of 2025 eased to 1.3%, compared to 1.5% in the first quarter.

Compared with regional peers, Malaysia’s inflation in June was lower than Vietnam (3.6%), South Korea (2.2%), Indonesia (1.9%), and the Philippines (1.4%), but above China (0.1%) and Thailand (-0.3%).

DOSM noted that 339 out of the 573 items tracked posted price increases in June, though nearly all remained within a 10% range. Only 10 items registered increases above 10%, while 192 items saw price declines and 42 remained unchanged.