Analysis: What causes the penny pinch?

Khazanah Research Institute (KRI) Director of Research Dr Suraya Ismail believes that social safety nets can help to alleviate the public's cost of living concerns. AZHAR MAHFOF/The Star

Despite Malaysia’s low inflation rate, many still struggle to get by. Why is this so? The World Bank’s latest Malaysia Economic Monitor report highlights areas that may contribute to our high cost of living.

MALAYSIANS say they are struggling to get by financially with the prevailing perception being that that cost of living is cripplingly high.

This is despite the fact that Malaysia experiences consistently low rates of inflation. Headline inflation averaged less than 2% per year since January 2015 and moderating to less than 1 per cent since January 2018 – well below the growth rates of the economy and average nominal incomes.