Kuala Lumpur, 19 September 2025 — Bank Negara Malaysia (BNM) has admitted that cost-of-living pressures remain a serious issue for many Malaysians, even though headline inflation has eased. In remarks made by Governor Datuk Seri Abdul Rasheed Ghaffour, the challenge is not just about price stability, but ensuring that incomes keep pace with rising costs so households can maintain their purchasing power.
Despite Malaysia’s official inflation readings showing modest increases, Rasheed noted that everyday Malaysians continue to feel the effects of higher food and essentials prices, transport and utility costs. He emphasised that wage growth has lagged in many sectors, and that rising expenses are more acutely felt when wages fail to catch up — especially for lower-income earners and those living in areas with more exposure to price fluctuations.
To address these pressures, BNM signalled that its policy stance, including an overnight policy rate (OPR) of 2.75%, is designed to strike a balance: supporting economic growth while keeping inflation under control. The central bank believes that current measures—such as wage interventions, ongoing government subsidies, and upstream cost management—are helping, but more may be needed if cost pressures intensify.
Governor Rasheed also pointed to steady employment conditions and labour market resilience as positive underpinnings for household income. He referenced recent government actions including minimum wage increases, adjusted civil service pay, and other assistance schemes as having a mitigating effect — though he cautioned that feeling better off depends on sustained and inclusive wage growth.
Markets watchers and economists see BNM’s comments as underscoring the possibility that future rate cuts will be gradual. Further easing will likely hinge on how inflation behaves—both headline and core—and on how well wage trends keep up with prices.
