Malaysia’s inflation rate stood at 1.8% in 2024, backed by the strengthening ringgit and a decline in global commodity prices, the statistics department said today.
In a statement, the department also said government initiatives to regulate the prices of goods and services, as well as subsidies for certain items, had helped keep Malaysia’s inflation from rising further last year.
The 1.8% inflation rate for 2024 was lower than estimates by Bank Negara Malaysia (2% to 3.5%) and the finance ministry (2.1% to 3.6%).
Malaysia’s inflation rate in 2023 stood at 2.5% while it was 3.3% in 2022.
Chief Statistician Uzir Mahidin said all economic groups recorded price increases in 2024, except for information and communication (-1.5%) and clothing and footwear (-0.3%).
The slower increase in the inflation rate was driven by restaurants and accommodation services (3.1%); food and beverages (2.0%); health (1.8%); education (1.5%); transport (1.0%) as well as furnishings, household equipment and routine household maintenance groups (0.7%).
The food and beverage group, which represents the largest component of household spending in Malaysia with a contribution of 29.8% of the total consumer price index weight, recorded a slower increase to 2% in 2024 compared to 4.8% in 2023.
The slower increase was largely due to the subgroup of food at home, which inclined to 0.6% compared to 3.5% in 2023. The food away from home subgroup also moderated to 3.6% compared to 6.7% in 2023.
Inflation for housing, water, electricity, gas and other fuels recorded a significant increase of 3%, attributed to the rise in sewerage service charges by Indah Water Konsortium in January 2024 to offset higher operational costs.
The increase in this group was also driven by the adjustment of water supply service tariffs by the government through the National Water Services Commission, which involved an average increase of 22 sen per cubic metre for domestic users in Peninsular Malaysia and Labuan effective Feb 1 last year.
The 1% increase in the transport group was attributed to the implementation of targeted diesel subsidies last June to control the leakage of subsidised diesel. This measure set the retail price of diesel at fuel stations in Peninsular Malaysia at between RM2.95 per litre and RM3.35 per litre compared to RM2.15 per litre previously.
Most states registered a slower increase in inflation last year, with four states exceeding the national inflation rate: Penang (3%), Pahang (2.4%), Sarawak (2.4%) and Selangor (2.1%).
Labuan recorded the lowest increase at 0.7%.
The inflation rate for urban areas recorded a slower increase of 1.8% compared to 2.6% in 2023, while the inflation rate in rural areas also moderated to 1.7% in 2024 (2023: 2.1%)
