Beyond Spending, Raya Reflects Household Economic Expectations

By Nurunnasihah Ahmad Rashid

KUALA LUMPUR, Feb 22 (Bernama) -- Many Malaysians may be tightening their belts, but when it comes to Hari Raya Aidilfitri, cutting back is often not an option, as households continue to prioritise festive spending despite ongoing cost-of-living pressures.

Across the country, families are adjusting daily expenditure, postponing discretionary purchases and budgeting more carefully, yet still allocating funds for key festive essentials such as clothing, food preparations, balik kampung travel and duit raya.

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The pattern highlights a distinctive dimension of consumer behaviour in Malaysia, where festive consumption remains resilient not merely as an economic activity, but as a reflection of cultural values, social expectations and household priorities.

For many families, ensuring that Aidilfitri is celebrated meaningfully remains a commitment that transcends financial constraints.

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Raya Remains a Household Priority

A civil servant who wished to be known only as Siti Sulaiman, 38, said she has become more mindful of spending but continues to set aside funds for her four children’s festive needs.

“We cut down on eating out and shopping for ourselves, but for Raya, the children still come first. New clothes and balik kampung are things we try to ensure,” she said.

Meanwhile, Hafiz Hambali, 29, a private sector employee, said he has started saving earlier to prepare for festive expenses, even as financial conditions remain tight.

“I manage other expenses and save gradually. Raya is still something we look forward to every year, so I set aside duit raya and prepare the basics, even if the celebration is simple,” he said.

Another civil servant, Nur Firdaus Abdul Rahim, said purchasing kuih raya remains a fixed component of her festive preparations each year, describing the practice as deeply embedded in her family’s Hari Raya tradition despite rising living costs.

“For me, kuih raya is a must during Hari Raya. Since young, we have been accustomed to having festive cookies at home — whether many or few, there must be some,” she said.

Firdaus said she manages expenses by adjusting spending in other areas, including limiting purchases of new festive attire to a single outfit on the first day of the celebration and reusing existing clothing thereafter.

She added that her kuih raya spending is typically capped at around RM500 annually due to her large family, noting that while reducing such purchases would be disappointing, having even a modest selection would still preserve the festive spirit.

Festive Spending Beyond Consumption

Centre for Market Education chief executive officer Dr Carmelo Ferlito said festive spending should not be viewed purely through the lens of consumption, as it also embodies social meaning embedded in family relationships, reciprocity and identity.

“Households are not simply buying food, clothes or decorations; they are reaffirming belonging. Even under cost-of-living pressures, they tend to reallocate priorities rather than abandon festive spending,” he told Bernama.

Ferlito said traditions and family expectations play a central role in shaping spending decisions, including hosting relatives, preparing meals and giving duit raya, all of which carry symbolic and emotional significance.

“In other words, economic action is future-oriented and meaning-driven.

“Even when households try to cut back, they tend to protect expenditures that sustain identity and relational capital, while reducing more anonymous or less meaningful consumption,” he added.

On whether resilient festive spending signals strength or vulnerability, Ferlito said both dynamics may coexist.

“Stable festive spending may indicate confidence in future income prospects.

“However, we should not ignore the possibility of intertemporal substitution or short-term liquidity management — using savings, bonuses or even credit to smooth consumption during peak symbolic periods. In such cases, festive spending may coexist with underlying financial fragility,” he said.

Multiple Pathways to Finance Festivities

Meanwhile, Bank Muamalat Malaysia Bhd chief economist Dr Mohd Afzanizam Abdul Rashid said households today have greater flexibility in financing festive spending, drawing on income, savings and a range of financial facilities.

Such flexibility expands funding options, but does not eliminate financial risk, particularly if households rely heavily on short-term credit.

Beyond traditional bank financing, consumers may also utilise the Employees Provident Fund’s flexible account, buy-now-pay-later (BNPL) schemes and Ar Rahnu services, depending on their financial circumstances.

Mohd Afzanizam said consumption typically strengthens during festive periods, although recent data suggest households remain cautious, with private consumption growth of 5.3 per cent in the fourth quarter of 2025 still below its long-term average of around six per cent.

The cautious stance reflects lingering cost-of-living pressures that continue to influence spending decisions, he added.

He also noted higher credit utilisation during Ramadan and Hari Raya, particularly in personal financing and vehicle purchases, often supported by promotional campaigns from financial institutions and dealers.

Balancing Celebration and Caution

While festive spending remains robust, Mohd Afzanizam cautioned against overleveraging, especially when households obtain financing from multiple sources.

He emphasised the importance of financial literacy and prudent spending management, noting that Ramadan also offers an opportunity to practise moderation and restraint in financial decision-making.

Ferlito added that a significant decline in festive spending would serve as a strong signal of weakening household expectations and confidence.

He said festive consumption is typically “protected” due to its symbolic importance, and any substantial reduction could reflect a shift from adaptive optimism to defensive financial behaviour.

Ultimately, economists said festive spending offers a window into how Malaysian households interpret their financial realities and future prospects, making Hari Raya consumption not merely a seasonal economic event, but a meaningful indicator of expectations within the household economy.

-- BERNAMA