Indonesia Inflation Rate Eases to 2.31% in August

Indonesia’s annual inflation accelerated to 3.08% in May 2026 from an eight-month low of 2.42% in the prior month, surpassing market expectations of 2.97%. Despite the pickup, inflation remained within the central bank’s target range of 1-1/2% to 3-1/2%. Food prices rose the most in eight months (4.94% vs 3.06% in April), driven by higher staple costs and elevated distribution expenses across several regions. Additional upward pressures also came from housing (1.0% vs 0.74%), transport (2.30% vs 1.61%), clothing (0.84% vs 0.79%), furnishings (0.98% vs 0.60%), healthcare (1.70% vs 1.49%), communication (0.97% vs 0.83%), recreation (1.30% vs 1.19%), education (1.15% vs 1.14%), and restaurants (2.34% vs 1.93%). Core inflation, which strips out volatile food and administered prices, quickened to a three-month high of 2.59% from 2.44% in April. On a monthly basis, consumer prices increased 0.28%, up from a 0.13% rise in April and well above forecasts of 0.14%.

Indonesia’s annual inflation dropped noticeably to 2.42% in April 2026 from 3.48% in the prior month, marking the lowest level since August 2025 and remaining comfortably within the central bank's 1-1/2%–3-1/2% target range. The moderation was driven by softer price growth in key components, particularly food (3.06% vs 3.34% in March) and housing (0.74% vs 7.24%). Meanwhile, inflation held steady for healthcare (at 1.49%) and education (at 1.14%). Several categories saw firmer price pressures, including clothing (0.79% vs 0.65%), furnishings (0.60% vs 0.24%), transport (1.61% vs 0.61%), recreation (1.19% vs 1.08%), and restaurants (1.93% vs 1.42%). Also, communication prices rebounded (0.83% vs -0.03%). Core inflation, which strips out volatile food and administered prices, eased to 2.44% from March's 2.52%, indicating the softest figure in four months. On a monthly basis, consumer prices rose 0.13%, slowing from a 0.41% gain in March and signaling the mildest pace in three months.

Indonesia’s annual inflation eased to 3.48% in March 2026 from 4.76% in the previous month, marking the lowest level since December and falling short of market expectations of 3.60%. The latest reading remained within the central bank's 1-1/2%–3-1/2% target range, as price growth slowed for food (3.34% vs 3.51% in February), clothing (0.65% vs 0.73%), housing (7.24% vs 16.19%), and health (1.49% vs 1.61%). Meantime, communication costs were almost flat (-0.03% vs -0.09%). In contrast, inflation accelerated for furnishings (0.24% vs 0.21%), transport (0.61% vs 0.12%), recreation (1.08% vs 0.96%), education (1.14% vs 1.11%), and restaurants (1.42% vs 1.37%). Core inflation, which strips out volatile food and administered prices, dropped to 2.52%, below February's figure and forecasts of 2.63%. On a monthly basis, consumer prices rose 0.41%, moderating from a 0.68% increase in February, though still indicating a second consecutive month of gains.