KUALA LUMPUR (Aug 22): Malaysia’s headline inflation picked up slightly as expected amid a spike in insurance premiums and higher prices of restaurant and accommodation services, latest official data showed.
The Department of Statistics Malaysia said the consumer price index, the country’s main gauge of inflation, rose 1.2% in July when compared to the same month last year. A Bloomberg poll of economists also predicted a median increase of 1.2%. In June, the index was up 1.1% year-on-year.
A group that includes insurance and financial services registered the sharpest increase, surging 5.5% in July versus a 1.5% gain in June. Hospital benefit insurance premiums accelerated nearly 15%, compared with only a 0.4% rise in June.
Restaurants and accommodation services inflation was 3.1% in July versus 2.8% in the previous month.
Food and beverages, which makes up nearly 30% of the index’s basket, rose at a slower pace of 1.9% from 2.1% in June.
Prices of food at home fell 0.3%, led by declines in vegetables, eggs, and chicken. Dining out became slightly more affordable, with food-away-from-home inflation easing to 4.3% from 4.7% in June.
Moderation in housing and utilities also helped cap overall inflation, as electricity and gas charges fell following the implementation of a new tariff schedule effective July.
Headline inflation has remained below 2% for 24 straight months since July 2023.
Core inflation, which measures demand-driven pressure by stripping out volatile food and fuel prices, held steady at 1.8% for the third consecutive month.
At the state level, 12 states recorded inflation below the national rate of 1.2%. Johor posted the highest rate at 1.8%, followed by Selangor (1.5%) and Negeri Sembilan (1.4%). Kelantan saw no increase in prices.
Chief statistician Datuk Seri Dr Mohd Uzir Mahidin noted that 58.3% of the 573 items tracked saw price increases in July, though almost all were contained within a 10% range. Only 12 items recorded increases of more than 10% in July 2025 while 189 items declined and 50 items unchanged.