Indonesia’s consumer price index inflation in February 2023 decreases  

Consumer price index inflation of Indonesia remained under control at 5.47 percent (year-on-year/yoy), although it was slightly higher than inflation in the previous month which reached 5.28 percent (yoy).

 

Jakarta (Indonesia Window) – The Statistics Indonesia (BPS) recorded that the consumer price index (CPI) inflation in February 2023 decreased from 0.34 percent (month-to-month/mtm) in the previous month to 0.16 percent (mtm), driven mainly by reduced inflation in the core and volatile foods category.

This development was inseparable from the positive influence of Bank Indonesia’s monetary policy response as well as the close synergy in inflation control between the central bank and the central government, regional administrations and other strategic partners through the Central and Regional Inflation Control Teams and the National Movement for the Control of Food Inflation in various regions.

With these developments, the annual consumer price index inflation remained under control at 5.47 percent (yoy), although it was slightly higher than inflation in the previous month which reached 5.28 percent (yoy), the Director of Bank Indonesia’s Communication Department, Fadjar Majardi, said in his written statement as quoted by Indonesia Window on Thursday.

In the future, Bank Indonesia believes the core inflation would remain within the range of 3.0 ± 1 percent in the first semester of 2023 and CPI inflation would return to the target of 3.0 ± 1 percent in the second semester of 2023, Fadjar explained.

Bank Indonesia will continue to strengthen the inflation control, among others through coordination with the government to ensure continued inflation reduction, including during the national religious holidays period, he said.

The core inflation in February 2023 was recorded at 0.13 percent (mtm), down from the previous month’s inflation of 0.33 percent (mtm).

The decline in the core inflation was in line with the normalization of the seasonality pattern at the beginning of the year, especially from the housing commodity category.

On an annual basis, the core inflation in February 2023 was recorded at 3.09 percent (yoy), lower than the inflation in the previous month of 3.27 percent (yoy).

The inflation in the volatile foods category also declined compared to the previous month, recorded at 0.28 percent (mtm), lower than the inflation in the previous month which was 1.40 percent (mtm).

This development was mainly contributed by the commodities of meat, broiler chicken, purebred chicken eggs, and cayenne pepper. However, the volatile foods group experienced an annual inflation of 7.62 percent (yoy), higher than the previous month’s inflation of 5.71 percent (yoy).

The administered prices group recorded inflation of 0.14 percent (mtm), an increase from the previous month’s realization which experienced a deflation of 0.55 percent (mtm).

This development was mainly contributed by the rise in the prices of filter clove cigarettes and white cigarettes due to the increase in tobacco excise.

The increase in administered prices inflation was further restrained by air transport fare deflation in line with the decline in the price of avtur (aviation turbine) or jet fuel. On an annual basis, the administered price component recorded inflation of 12.24 percent (yoy), lower than that in the previous month which amounted to 12.28 percent (yoy).

Reporting by Indonesia Window