According to Damhuri Nasution, an economist at BNI Securities, the Consumer Price Index (CPI) is expected to experience a monthly inflation rate of 0.23 percent in April 2023.
Meanwhile, the annual inflation rate is predicted to reach 4.22 percent, which is lower than the March 2023 inflation rate of 4.97 percent.
The decline in the annual inflation rate can be attributed to the much higher monthly inflation rate in April 2022, which was 0.95 percent compared to April 2023’s 0.23 percent.
Damhuri further explained that during the Ramadan and Eid al-Fitr periods, the prices of basic necessities were generally under control. The government’s import of several basic commodities such as rice, beef, sugar, garlic, and others also helped stabilize volatile food prices.
Furthermore, the bountiful harvest of food crops also contributed to the stability of basic commodity prices throughout the fasting month and Eid al-Fitr period.
Based on data from the National Strategic Food Price Information Center (PIHPS), the price of rice decreased by 0.8 percent month-to-month (mtm), down from a 1.5 percent increase in March 2023.
Other commodities, such as garlic, which saw a 9.6 percent mtm increase in March 2023, only recorded a 1.2 percent increase in April 2023. Additionally, the prices of chicken eggs, chicken meat, and beef only increased by 1.1 to 1.4 percent mtm from the previous month.
The prices of other basic necessities such as sugar and cooking oil were also relatively stable in April 2023. Meanwhile, some basic necessities recorded significant deflation in April 2023, such as red chili and bird’s eye chili, which both fell by -10.1 percent and -26.2 percent mtm, respectively, from the previous month’s 8.2 percent and 10.4 percent mtm increase in March.
Overall, the prices of basic necessities tend to decrease in April, which means that the food, beverage, and tobacco expenditure groups have the potential to experience deflation or only low inflation.
However, the celebration of the National Religious Holidays (HBKN) drives up the prices of transportation and clothing expenditure groups due to increased demand. The personal care expenditure group also continues to experience inflation due to the constantly rising price of gold in the global market.
In conclusion, the stable prices of basic necessities during Ramadan and Eid al-Fitr periods helped control the inflation rate in April 2023, with some basic necessities experiencing significant deflation. The celebration of the National Religious Holidays also impacted the prices of certain expenditure groups.