March 2023 Inflation of 0.18 Percent, Airlangga: Relatively Controlled

Armfalcon.com, JAKARTA — The government said the March inflation rate of 0.18 percent was relatively under control. The Central Statistics Agency (BPS) released data on actual inflation for Indonesia in March 2023 of 4.97 percent (yoy). This realization was lower than February 2023 of 5.47 percent (yoy) but higher than March 2022 inflation of 2.64 percent (yoy).

“On a monthly basis, March 2023 inflation was recorded at 0.18 percent (mtm). This figure is relatively under control considering that this month has entered Ramadan. This means that supply at the consumer level is still safe and distribution is not disrupted,” Coordinating Minister for the Economy Airlangga Hartarto said in an official statement, Wednesday (5/4/2023).

By component, price inflation is regulated by the government (administered prices/AP) experienced inflation of 0.12 percent (mtm) so that the year-on-year inflation rate was 11.56 percent (yoy). AP inflation was mainly driven by increases in air fares, gasoline and filter clove cigarettes.

“The long holiday moment at the beginning of Ramadan and the presence of big events such as the 2023 ASEAN Summit will encourage an increase in demand for transportation, especially air transport,” he said.

Meanwhile, food price inflation fluctuated (volatile foods/VF) recorded inflation of 0.29 percent (mtm) or 5.83 percent (yoy). The main commodities contributing to VF inflation this month (mtm) were rice and cayenne pepper with a share of 0.02 percent each, but inflationary pressure volatile foods can still be helped by the reduction in the price of shallots and red chilies.

The BPS noted that harvests had been carried out in 10 provinces and 66 main districts, but the presence of weather anomalies in parts of Indonesia had disrupted production. This has caused rice prices to continue to increase in March 2023, although not as high as in previous months.

On the other hand, on March 15 2023, the National Food Agency announced a change in the cost of goods sold for grain and rice as well as the highest retail price for rice. The goal is to create a balance upstream and downstream so as to create fair prices, both at the level of producers, millers, traders and consumers.

In order to maintain price stability and help the community, the government has also distributed food social assistance to 21,353 beneficiary families in 515 regions in the March-May 2023 period.

“The government and related authorities will continue to strengthen policy communication synergies to support the management of public inflation expectations, so that they remain under control, especially during Ramadhan and Idul Fitri 2023. In addition, the Government and Bank Indonesia through TPIP and TPID will also continue to work together to keep inflation within the target range. It is hoped that this will become a strong foundation for the national economy in 2023,” he said.