Malaysia’s PPI Edges Up 0.3% in February 2025, Slowest Growth in Three Months

Malaysia’s Producer Price Index (PPI) for local production rose by a modest 0.3% year-on-year in February 2025, a slowdown from the 0.8% increase in January 2025, marking the third consecutive month of growth but at the weakest pace in the sequence, according to the Department of Statistics Malaysia (DOSM).

Agriculture and Fishing

The agriculture, forestry, and fishing sector drove the increase, growing by 15.2% year-on-year, supported by a 26.1% rise in perennial crops, though this was softer than January’s 16.5%. Water supply prices grew by 2.9%, while electricity & gas supply and mining sectors declined by 0.2% and 9.7%, respectively. The manufacturing sector saw a milder deflation of 0.3%, continuing a six-month trend.

On a month-on-month basis, PPI edged up by 0.1%, with gains in agriculture, forestry, and fishing (+1.4%), electricity & gas supply (+0.2%), and manufacturing (+0.3%). By processing stage, crude and intermediate materials remained flat, while finished goods rose by 0.7%, led by a 1.7% increase in capital equipment. With PPI below the Consumer Price Index (CPI) of 1.5% in February, businesses are unlikely to pass on costs to consumers.

While subsidy cuts, wage hikes, and utility costs could fuel inflation, potential delays in subsidy rationalization may keep inflation stable.