Malaysian consumers tighten non-essential spending

Consumers select goods at a supermarket in Kuala Lumpur. (Photo: VNA)

Kuala Lumpur (VNA) - Malaysians are tightening their purse strings on non-essential spending, with rising costs prompting households to prioritise necessities and value for money despite continued economic growth, reported the local New Straits Times.

CIMB Securities Sdn Bhd analyst Walter Aw Lik Hsin said shoppers are increasingly seeking cheaper products, convenience and value, while cutting back on clothing, lifestyle goods and other non-essentials.

This comes as the latest second-quarter earnings of 16 consumer companies tracked by CIMB Securities point to a widening divide between spending on everyday necessities and discretionary purchases.

Aw said revenue among consumer staples rose 8.6% year-on-year in the second quarter (Q2) of 2026, while core net profit increased 11.1%. On the discretionary side, retailers still managed 4.3% revenue growth, but core net profit fell 7% as softer underlying demand collided with rising costs.

Aw said the divergence between revenue and earnings indicated that discretionary spending was still growing but was increasingly concentrated in lower-value and semi-durable categories.

The apparent caution among households comes even as broader economic indicators continue to point to relatively healthy consumption.

Malaysia's private consumption expanded 4.8% year-on-year in Q2, slightly faster than the 4.7% growth recorded in the preceding quarter, the Statistics Department data show.

The country’s economy expanded 6% in Q2 and 5.7% in the first half, while Bank Negara expects full-year growth of around five per cent.

Yet strong economic growth does not necessarily translate evenly into household spending, particularly when consumers are simultaneously adjusting to higher everyday costs./.

VNA