Indonesia Inflation June 2021


Indonesia: Inflation recedes in June

July 1, 2021

Consumer prices dipped a seasonally-adjusted 0.16% from the previous month in June, swinging from the 0.32% increase recorded in May. June's reading marked the first decrease in prices in nine months.

Inflation came in at 1.3% in June, down from May’s 1.7%. June's reading came amid renewed lockdown measures and marking the lowest inflation rate since May 2000. Annual average inflation remained stable at May’s 1.5% in June, while core inflation rose to 1.5% in June, from the previous month's 1.4%.

Commenting on the short-term outlook for inflation Nicholas Mapa, senior economist at ING, stated:

“Inflation has stayed below the central bank’s 2-4% inflation target for more than a year and we expect price pressure to stay soft in the coming months with President Jokowi considering tighter lockdown measures to deal with a recent surge in Covid-19 infections. The extended partial lockdowns and the prospect of even tighter measures will only sap more from economic momentum, resulting in subdued inflation in the second half of the year.”

FocusEconomics panelists project inflation of 2.2% in 2021, which is unchanged from last month’s forecast. In 2022, inflation is seen averaging 3.0%.


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Indonesia Inflation Chart

Indonesia Inflation June 2021

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

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