Malaysia’s July Inflation Eases to 1.8% as Transport Price Growth Slows

KUALA LUMPUR, AUGUST 2026 — Malaysia’s headline inflation eased to 1.8% year-on-year in July 2026, compared with 1.9% in June, according to the Department of Statistics Malaysia (DOSM).

The Consumer Price Index (CPI) stood at 137.1 points, up from 134.7 points in July 2025, indicating that consumer prices continued to rise but at a slightly slower annual pace.

Official OpenDOSM data also confirms July’s 1.8% inflation reading, extending the gradual moderation seen from 2.1% in March to 2.0% in April and May, 1.9% in June and 1.8% in July.

Transport was one of the main contributors to the moderation in headline inflation.

Inflation in the transport group slowed to 1.4% in July, compared with 2.8% in June. The softer increase helped reduce pressure on the overall CPI despite continued price increases elsewhere in the economy.

Personal care, social protection and miscellaneous goods and services also moderated to 2.9%, from 3.4% previously. Restaurant and accommodation services eased to 2.0% from 2.6%, while education inflation slipped marginally to 2.0% from 2.1%.

A particularly sharp moderation was recorded in the insurance and financial services category, where inflation eased to 1.1% in July from 5.7% in June.

Health inflation also moderated slightly to 1.1% from 1.2%, while furnishings, household equipment and routine household maintenance increased by a modest 0.3%, compared with 0.4% in the previous month.

Not all categories recorded slower price growth.

Inflation for food and beverages increased to 1.8% in July from 1.4% in June, while housing, water, electricity, gas and other fuels also accelerated to 1.8% from 1.4%.

Information and communication recorded an even stronger increase, with inflation accelerating to 3.4% from 2.4% in June.

Recreation, sport and culture edged up to 1.2% from 1.1%, while clothing and footwear recorded a marginal 0.1% increase after being unchanged in June.

DOSM said 374 out of 573 items, or 65.3%, recorded price increases in July.

Of those items, 367 — representing 98.1% of products that became more expensive — recorded increases of 10% or less. Seven items registered price increases exceeding 10%.

Another 157 items, or 27.4%, recorded price declines, while 42 items remained unchanged.

The figures indicate that although headline inflation has moderated, price increases remain relatively broad across Malaysia’s consumer basket.

Inflation also varied considerably across states.

Seven states and federal territories recorded inflation above the national 1.8% rate, led by Negeri Sembilan at 2.5%.

Kedah and Pahang followed at 2.3% each, while Kuala Lumpur recorded 2.2%, Johor 2.1%, Labuan 2.0% and Sabah 1.9%.

DOSM said food and beverage inflation increased across all states except Kelantan and Labuan, where it remained unchanged.

On a month-on-month basis, Malaysia’s overall CPI was unchanged in July, matching the flat monthly reading recorded in June.

Food and beverages rose 0.3% during the month, slightly faster than June’s 0.2% increase.

Recreation, sport and culture as well as restaurant and accommodation services each rose 0.2%, while education increased by 0.1%.

Transport prices, however, declined 1.1% month-on-month, while personal care, social protection and miscellaneous goods and services fell 0.5%.

The latest figures indicate that Malaysia continues to experience relatively moderate consumer inflation despite varying price pressures across different sectors.

Slower transport inflation helped push the headline rate lower, but accelerating costs in areas such as food, housing and communications show that households are still experiencing price increases in several essential spending categories.

July’s 1.8% reading will remain an important indicator for policymakers and businesses as they assess consumer spending conditions, cost-of-living pressures and Malaysia’s economic outlook for the second half of 2026.