The Nielsen report attributed waning confidence to brewing worries over Malaysia's economic outlook, a near 20 percent drop in the value of the Malaysian ringgit year-to-date and the spreading of what is being called the country's worst-ever political crisis.
Malaysia's Prime Minister Najib Razak has been facing questions over his alleged role in a graft scandal at state investment fund 1Malaysia Development Bhd (1MDB). In an interview with local daily spreadsheet The Star on Wednesday, Najib said the government is "applying rigorous and exhaustive processes of investigation" to address concerns over governance. He also expressed his confidence in the implementation of "a successful rationalisation process with a massive reduction in debts" in the state investment fund in the remaining months of 2015.
More than 60 percent polled in the third quarter cited concerns about the nation's financial conditions, compared with 43 percent in the previous three months. Meanwhile, a third of the respondents said political stability was the second-most worrying issue, an increase from 13 percent in the last quarter.
"The currency devaluation has potentially impacted the general perception of the country's economic strength of the country. [As] concerns over rising food prices subsided [from the second quarter], political stability is now the second highest concern after recent high-profile demonstrations and as politics [dominates] the media headlines," Richard Hall, country manager of Nielsen Malaysia, told CNBC in an e-mail interview.
The Nielsen survey also found that recessionary sentiment is growing in Malaysia, up a "notable" 16 percentage points in the third quarter, with "nearly nine in 10 Malaysians feeling the country is currently in a state of recession." Indonesia and Thailand are the other two countries in the region which saw a rise in recessionary sentiment, up 10 and 8 percentage points respectively.
Read MoreWhy Malaysia may have hit bottom
Malaysia's second-quarter gross domestic product (GDP) growth slowed to its lowest rate since the third quarter of 2013. The Southeast Asian economy expanded 4.9 percent on-year over the April-June period.
These results mirror a similar survey released by the Malaysian Institute of Economic Research (Mier) on October 28. Mier's third-quarter consumer sentiment index (CSI) hit a new low of 70.2, down from the 71.7 points recorded in the preceding three months, as Malaysians realize that their money isn't going as far as it used to.
As a result, consumers in the Southeast Asian country of 30.4 million are "becoming more frugal in view of the increasing cost of living," Nielsen's Hall said.
Citing the same reasons, the Malaysia Retailers Association (MRA) in July lowered its projected retail growth for the third time this year, to 4 percent from 4.9 percent, as consumers opt to save rather than spend their spare cash.
Caroline Russell, CEO of Malaysia's homegrown tea maker Boh Plantations, told CNBC in an interview with "Managing Asia" last month: "Malaysians are beginning to feel the pinch after what has been a difficult year for Malaysians, especially with the introduction of the goods and services tax (GST) in April." Russell was referring to the implementation of the 6% GST in April this year, with the aim of reducing the country's budget deficit.
Read MoreTea grower takes Malaysia's brewing storm in stride