Inflation eases in October from September

Latest reading: Consumer prices rose 1.3% in annual terms in October, following a 1.5% increase in the prior month. Relative to the prior month's data, there were milder price pressures for food and non-alcoholic beverages (+1.5% on a year-on-year basis vs +2.1% in September), housing and utilities (+1.1% vs +1.5% in September) and transportation (-0.1% vs +0.7% in September). In contrast, price pressures were higher for recreation services and culture in October (+1.2% vs +0.9% in September). Finally, consumer prices were down 0.07% in October in month-on-month terms, following a 0.22% increase in the previous month.

Panelist insight: United Overseas Bank’s Julia Goh and Loke Siew Ting commented on the outlook for inflation and monetary policy: “Heading into 2026, inflation is anticipated to stay contained, even as projections point to a slight increase to 2.0% (MOF est: 1.3%- 2.0%). Our view is mainly premised on limited impact from RON95 subsidy rationalisation (BUDI95), manageable pass-through of ongoing domestic fiscal reforms and global tariff-induced costs, as well as the absence of excessive demand pressures amid a stable domestic growth and a firmer MYR outlook. […] The recent inflation trend, alongside a cautiously optimistic domestic outlook, easing global tariff risks, and subdued commodity prices, gives Bank Negara Malaysia (BNM) greater flexibility to maintain its current monetary stance in the near term.”

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