Indonesia Inflation Rate Eases to 2.31% in August

Indonesia’s annual inflation edged down to 3.23% in October 2026 from September’s three-month high of 3.28%, coming below market expectations of 3.29% and staying within Bank Indonesia’s target range of 1-1/2%-3-1/2%. Price growth slowed for recreation (1.76% vs 1.81% in September), education (1.35% vs 1.43%), and personal care (4.52% vs 7.77%). Meanwhile, cost accelerated for housing (1.06% vs 1.02%), transport (4.87% vs 4.84%), clothing (1.26% vs 1.20%), furnishings (2.39% vs 2.19%), healthcare (2.31% vs 2.24%), and communication (1.91% vs 1.83%). Food inflation hit a five-month peak (4.82% vs 4.37%), reflecting the lingering effects of El Niño disruptions. Core inflation, which excludes volatile food and government-administered prices, fell to 2.56% from 2.84% in September, marking a six-month low and falling short of forecasts of 2.75%. Monthly, consumer prices rose 0.22%, slowing from 0.3% in September and undershooting forecasts of 0.25%, but marking a third monthly increase.

Indonesia’s annual inflation rose to 3.28% in September 2026 from 3.19% in the previous month, roughly in line with market expectations of 3.3%. It marked the highest reading since June while remaining within Bank Indonesia’s 1-1/2%-3-1/2% target range. Food inflation hit a three-month peak (4.37% vs 3.86% in August), reflecting the persistent impact of El Niño disruptions. Additional upward pressures also came from housing (1.02% vs 1.01%), transport (4.84% vs 4.79%), clothing (1.20% vs 1.20%), furnishings (2.19% vs 2.0%), healthcare (2.24% vs 2.12%), communication (1.83% vs 1.72%), recreation, and restaurants (1.81% vs 1.75%), education (1.43% vs 1.20%), and personal care (7.77% vs 9.25%). Core inflation, which excludes volatile food and government-administered prices, eased to 2.84% from August's over three-year high of 2.92%. On a monthly basis, consumer prices increased by 0.30%, up from a 0.21% rise in August and broadly matching forecasts for a 0.31% gain.

Indonesia’s annual inflation accelerated to 3.19% in August 2026 from July’s three-month low of 2.28%, slightly exceeding market expectations of 3.13% while remaining within Bank Indonesia’s 1/2%–3-1/2% target range. Food inflation quickened (3.86% vs 2.97% in July), reflecting the impact of El Niño disruptions. Additional upward pressures also came from housing (1.01% vs 0.99%), transport (4.79% vs 5.12%), clothing (1.20% vs 1.04%), furnishings (2.0% vs 1.72%), healthcare (2.12% vs 1.96%), communication (1.72% vs 1.5%), recreation, and restaurants (1.75% vs 1.58%), education (1.20% vs 1.0%), and personal care (9.25% vs 9.04%). Core inflation, which excludes volatile food and government-administered prices, rose to 2.92% in August, the highest level since March 2023. On a monthly basis, consumer prices increased 0.21%, reversing a 0.14% decline in July and broadly in line with forecasts for a 0.2% rise.