Indonesia Inflation Rate Hits 1-1/2-Year High

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.

Indonesia’s annual inflation accelerated to 4.76% in February 2026 from 3.55% in the prior month, reaching its highest level since March 2023. The jump was largely due to a low base effect, as electricity tariff discounts launched in early 2025 had suppressed prices last year, pushing the latest reading above the central bank's 1-1/2%–3-1/2% target range. Upward price pressures came from most components, including food (3.51% vs 1.54% in January), housing (16.19% vs 11.93% in), clothing (0.73% vs 0.56%), furnishings (0.21% vs 0.16%), health (1.61% vs 1.62%), transport (0.12% vs 0.58%), recreation (0.96% vs 1.05%), education (1.11% vs 1.11%), and restaurants (1.37% vs 1.36%). Meantime, deflation in communication costs lingered (-0.09% vs -0.19%). Core inflation, which strips out volatile food and administered prices, rose to 2.63%, the strongest since May 2023. Monthly, consumer prices rose 0.68%, reversing a 0.15% decline in January and marking the fastest monthly gain in ten months.

Indonesia’s annual inflation accelerated to 3.55% in January 2026 from 2.92% a month earlier, the highest since May 2023. While the latest reading fell short of market forecasts of 3.8%, it edged slightly above the central bank's 1-1/2%–3-1/2% target range. Housing inflation surged sharply (11.93% vs 1.62% in December), mainly because electricity tariff discounts granted in early 2025 created a low comparison base. Price pressures persisted for food (1.54% vs 4.58%), clothing (0.56% vs 0.66%), furnishings (0.16% vs 0.2%), health (1.62% vs 1.83%), transport (0.58% vs 1.23%), recreation (1.05% vs 1.17%), education (1.11% vs 1.22%), and restaurants (1.36% vs 1.46%), although momentum eased in some segments. Meantime, deflation in communication costs lingered (-0.19% vs -0.28%). Core inflation, which strips out volatile food and administered prices, rose to 2.45%, the strongest in nine months. Monthly, the CPI fell 0.15%, after a 0.64% gain in December, marking the first drop since August.