Indonesia Inflation February 2019


Indonesia: Inflation declines further in February

March 1, 2019

Consumer prices decreased 0.08% in February from the previous month, contrasting January’s 0.32% increase. February’s print was driven by lower food prices.

Inflation dipped to 2.6% in February from 2.8% in January, marking the lowest reading since 2009 but remaining just within Bank Indonesia’s target range of 3.5% plus or minus 1.0 percentage point. Core inflation was unchanged at 3.1%.

Looking ahead, inflation is set to remain subdued thanks to ongoing government measures to control prices. However, our panelists do see an uptick from the current low level later this year, with the Consensus projecting inflation of 3.6% in 2019 and 3.8% in 2020. That said, inflation should stay within the target range. As a result, Bank Indonesia is likely to continue conducting monetary policy largely in response to developments in the external sector, particularly the evolution of the rupiah and the current account deficit.

Author:, Economist

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Indonesia Inflation Chart

Indonesia Inflation February 2019

Note: Annual and monthly variation of consumer price index in %.
Source: Statistics Indonesia (BPS) and FocusEconomics calculations.

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