KUALA LUMPUR: CIMB Investment Bank expects Malaysia’s inflation to average 2.6 per cent in 2025, with subdued core inflation likely keeping the overnight policy rate (OPR) steady at 3.00 per cent throughout the year.
In a note, CIMB said inflation should stay within the Finance Ministry’s target of 2.0 per cent to 3.5 per cent, supporting an extended pause in rate adjustments.
“Key risks to watch include the minimum wage hike, SST expansion, targeted RON95 subsidy rollout in mid-2025, and electricity tariff changes in July,” it said.
The Department of Statistics earlier reported February’s inflation rose 1.5 per cent year-on-year to 134.1 points, with a monthly increase of 0.4 per cent from January.
CIMB said the monthly rise is likely a one-off, similar to the May 2022 wage hike, when core inflation briefly rose before stabilising.
It added that wage and employment growth indicators in manufacturing and services remain modest, reinforcing expectations of muted core inflation in the near term. — BERNAMA
