Malaysia's producer prices rose 0.3% year on year in February, slowing from January's 0.8% gain, as easing commodity prices offset stubborn inflation in agriculture, data from the Department of Statistics showed on Thursday.

Higher costs in the agriculture, forestry & fishing sector, up 15.2% year-on-year, continued to drive inflation, though growth eased from 16.5% in January.

The mining sector contracted 9.7%, with crude petroleum and natural gas extraction falling 9.8% and 9.4%, respectively, in line with weaker global energy prices.

Manufacturing prices edged down 0.3% after a 0.6% drop in January, weighed by a 12.7% slide in petroleum products and a 3.2% decline in electronics.

Malaysia's trade surplus narrowed in February as shipments of electrical and electronic products, its largest export category, continued to struggle.

On a monthly basis, the producer price index (PPI) rose 0.1%, cooling from January's 0.3% increase.

Agriculture prices rebounded 1.4%, lifted by a 5.9% jump in fishing and a 1.6% rise in perennial crops, mirroring palm oil's recent price gains. Mining prices fell 3.2%, reversing the previous month's 5.3% gain.

By processing stage, finished goods prices rose 0.7% year-on-year, while crude and intermediate materials were unchanged. On a monthly basis, finished goods and crude materials added 0.3%, while intermediate materials slipped 0.1%.

The latest data comes as Malaysia's central bank holds its policy rate at 3%, balancing growth risks with inflation pressures.

Bank Negara Malaysia has projected headline inflation to remain manageable in 2025 but flagged uncertainty from global commodity prices and supply chain disruptions.