The cost of living for an average urban household of six surged by 20.57 percent in 2025, rising from K803,023 in January to K968,165 in December, according to the latest cost of living analysis report.
The report, which Employers Consultative Association of Malawi (Ecam) has published, indicates that, excluding transport expenses, the basic needs basket increased by 20.18 percent from K739,021 to K888,165 during the period under review.
Food prices drove much of the increase, rising 19.27 percent from K559,002 in January to K666,724 in December, while non-food items jumped 23.01 percent from K180,021 to K221,441.
Transport costs also rose by 25 percent from K64,000 to K80,000.
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Among basic food items, onions recorded the sharpest annual increase, surging 263.18 percent from K1,100 per kilogramme (kg) in January to K3,995 in December.
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Beef prices nearly doubled, rising 95.71 percent from K9,859 to K19,295 per kg.
Furthermore, eggs saw a 59.54 percent increase, moving from K9,399 to K14,995 per tray of 30, while sugar prices jumped 45.10 percent from K2,550 to K3,700 per kg.
Among non-food items, toothpaste prices jumped 88.57 percent from K2,598 to K4,899, while bath soap increased 121.40 percent from K1,285 to K2,845 per tablet.
Body lotion prices rose 57.32 percent from K2,896 to K4,556 per 400-milliliter bottle and the rate of Vaseline Blue Seal increased 77.69 percent from K3,295 to K5,855 per 100-milliliter bottle.
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Charcoal prices surged 48.15 percent from K27,000 to K40,000 per 50kg bag while electricity costs increased by 16 percent.
However, some items recorded decreases.
Maize prices fell 26.67 percent from K75,000 in January to K55,000 in December per 50 kg bag while vegetables dropped 8.31 percent from K349 to K320 per bunch.
The year ended on a slightly positive note, with the cost of living declining marginally by 0.65 percent in December, dropping to K968,165 from K974,542 in November.
Food prices decreased by 1.57 percent from K677,375 in November to K666,724 in December, driven largely by the drop in maize prices to K55,000 per 50 kg bag from K60,000 the previous month.
However, the rate of non-food items increased by 1.97 percent from K217,167 to K221,441 while transport costs remained constant at K80,000.
In an interview, economist Marvin Banda said 2025 would be remembered as a year when, for the first time in history, Malawians required to become millionaires just to attain the cost of living.
He said the 20.57 percent rise in 2025 only confirms that urban households have been, and are, under sustained economic pressure—and not a temporary inflation shock.
“Despite that maize prices fell fortuitously towards the end of the year, the overall living costs remained elevated, driven by sharp increases in non-maize food items and essential non-food goods. The politically fueled slowdown in maize prices led to disinflation in some instances which has led to lean season food prices being lower than last year.
“However, steep rise in prices of onions, beef, eggs and sugar points to supply chain weaknesses, high production costs and exchange-rate pressures rather than shortages of staple grains alone,” Banda said.
He added that the outlook remained bleak unless the macroeconomic fundamentals begin to show improvement.
“Inflation may slow if food production improves but living costs are unlikely to fall. For disinflation to occur sustainably, most of the economic sectors need to feel this price relief. Without better macroeconomic performance through the management of fiscal and monetary policies and a coordination effort to reduce Balance of Payment and fiscal deficit pressures, the consumer will continue to suffer from income erosion associated with high costs of living,” he said.
During pre-budget consultations for the 2026-27 national budget in Lilongwe, Finance Minister Joseph Mwanamvekha said inflation was projected to ease to 20.7 percent in 2026 from an expected 28.5 percent in 2025, though this remained high for households to bear.
Mwanamvekha a acknowledged that rising living costs continued to erode wages while businesses faced mounting pressures.
Reserve Bank of Malawi Deputy Governor Kisu Simwaka recently said the central bank may revise downward the policy rate if inflation continued declining on the back of easing food prices.
Inflation fell from 29.1 percent to 27.9 percent in recent months.
