Consumer Price Index Indonesia: Inflation at 3.31% in October
Statistics Indonesia (BPS) announced that inflation in Indonesia was recorded at 0.14 percent month-on-month (m/m) in October 2016, slightly higher than had been expected by analysts but lower compared to the 0.22 percent (m/m) of inflation that was reported in the preceding month. Meanwhile, on an annual basis (y/y), Indonesia's inflation rate accelerated to a seasonally adjusted 3.31 percent (y/y) in October, from 3.07 percent (y/y) in the preceding month.
BPS Chairman Suhariyanto said, generally, food prices declined in October (for example onions and chicken meat, although the price of red chilies actually rose). However, inflation in Indonesia was triggered by higher prices of mobile phone credit, the rising costs of rent (housing), rising college and university tuition fees, higher prices of filter cigarettes as well as higher electricity rates.
Indonesia's calendar year inflation accelerated to 2.11 percent in October 2016. Barring any unforeseen shocks, inflation will fall well within the central bank (Bank Indonesia)'s inflation target of 3 - 5 percent (y/y) at the year-end. We expect inflation to reach 3.1 percent (y/y) in full-year 2016 because monthly inflation in November is usually low (provided the government does not adjust administered prices), while December inflation can accelerate to the range of 0.50 - 1.00 percent (m/m) due to rising consumption ahead of Christmas and New Year celebrations.
Inflation in Indonesia:
| Month | Monthly Growth 2013 |
Monthly Growth 2014 |
Monthly Growth 2015 |
Monthly Growth 2016 |
| January | 1.03% | 1.07% | -0.24% | 0.51% |
| February | 0.75% | 0.26% | -0.36% | -0.09% |
| March | 0.63% | 0.08% | 0.17% | 0.19% |
| April | -0.10% | -0.02% | 0.36% | -0.45% |
| May | -0.03% | 0.16% | 0.50% | 0.24% |
| June | 1.03% | 0.43% | 0.54% | 0.66% |
| July | 3.29% | 0.93% | 0.93% | 0.69% |
| August | 1.12% | 0.47% | 0.39% | -0.02% |
| September | -0.35% | 0.27% | -0.05% | 0.22% |
| October | 0.09% | 0.47% | -0.08% | 0.14% |
| November | 0.12% | 1.50% | 0.21% | |
| December | 0.55% | 2.46% | 0.96% | |
| Total | 8.38% | 8.36% | 3.35% |
Source: Statistics Indonesia (BPS)
Inflation in Indonesia and Central Bank Target 2008-2016:
| 2008 | 2009 | 2010 | 2011 | 2012 | 2013 | 2014 | 2015 | 2016 | |
| Inflation (annual % change) |
9.8 | 4.8 | 5.1 | 5.4 | 4.3 | 8.4 | 8.4 | 3.4 | |
| Bank Indonesia Target (annual % change) |
5.0 | 4.5 | 5.0 | 5.0 | 4.5 | 4.5 | 4.5 | 4.0 | 4.0 |
Source: Bank Indonesia