BI Says Indonesia Inflation Cools Within Target
Jakarta. Indonesia’s inflation cooled sharply in March, reinforcing confidence that price pressures remain under control within Bank Indonesia’s target range, backed by coordinated policy and stronger food resilience.
Bank Indonesia (BI) said the Consumer Price Index (CPI) stayed within its 2.5±1% target band, supported by consistent monetary policy and close coordination between central and regional governments through inflation control teams.
Data from the Central Statistics Agency (BPS) showed monthly inflation stood at 0.41% in March, while annual inflation eased significantly to 3.48% year-on-year (yoy), down from 4.76% yoy in February.
BI Executive Director Ramdan Denny Prakoso said the contained inflation was also driven by stronger implementation of the National Food Resilience Program, adding that the central bank expects the trend to continue through 2027.
“Inflation remaining within the target range reflects consistent monetary policy and strong coordination between Bank Indonesia and both central and regional governments through the inflation control teams, alongside strengthened implementation of the National Food Resilience Program,” Ramdan said in an official statement on Thursday.
Core inflation came in at 0.13% month-to-month, easing from 0.42% in February, partly due to declining global gold prices and well-anchored inflation expectations despite heightened demand during the Idulfitri festive period. On an annual basis, core inflation was recorded at 2.52% yoy.
Meanwhile, volatile food prices rose 1.58% month-to-month, slowing from 2.50% in the previous month. Key contributors included chicken meat, rice, and eggs, driven by strong holiday consumption. BI expressed optimism that inflation in this category will remain manageable through its food stabilization programs.
Administered prices increased 0.31% month-to-month, reflecting higher non-subsidized fuel prices and rising intercity transportation fares amid the Idulfitri travel season. However, on a yearly basis, inflation in this category dropped sharply to 6.08% yoy from 12.66% yoy in February.
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