November Inflation Declines

Indonesian Traditional Market

Bank Indonesia (BI) updated the latest report regarding the Consumer Price Index (CPI). November 2022 CPI inflation, on an annual basis, was recorded at 5.42 percent (YoY), lower than the previous month which reached 5.71 percent (YoY).

Based on a report from the Central Statistics Agency (BPS), this figure is lower than inflation in October 2022 which reached 0.11 percent monthly or 5.71 percent on an annual basis.

Head of the Ministry of Finance’s Fiscal Policy Agency (BKF Kemenkeu) Febrio Kacaribu said that November’s inflation was lower than the Ministry of Finance’s internal prediction. This, he said, proves that domestic price stability can be maintained amidst high global inflationary pressures.

Inflation, which has begun to decline, cannot be separated from the success of coordination between the relevant authorities.

Based on its constituent components, core inflation was still recorded at the level of 3.3 percent (year-on-year/yoy). Febrio said the figure reflected the people’s still strong purchasing power amid rising prices.

Furthermore, Bank Indonesia assesses that the reduction in November 2022 cannot be separated from joint synergy efforts.

“The positive development of CPI inflation is inseparable from the influence of increasingly tighter policy synergies between the Central and Regional Governments, Bank Indonesia, and various other strategic partners,” said Executive Director of the BI Communication Department, Erwin Haryono in a press statement, Thursday (1/12 ).

Various programs were carried out by the Central and Regional Inflation Control Teams (TPIP-TPID) and the National Food Inflation Control Movement (GNPIP) in reducing the rate. Including controlling the after-effects of fuel price adjustments.

For 2022 as a whole, Bank Indonesia views it to be lower than the initial forecast. Although the value will still be above the target range of 2 to 4 percent.

BI projects that inflation in 2023 is expected to decline and return to the target of 2-41 percent in the first half of 2023. The policy synergy between the Central and Regional Governments and Bank Indonesia will continue to be strengthened to ensure that it returns to the set target soon.

The core inflation rate controlled by BI in November 2022 is also considered under control. It was recorded at 0.15 percent (mtm), slightly lower than the previous month of 0.16 percent (mtm).

“Controlled core inflation was mainly influenced by the continued impact of fuel price adjustments on limited core and inflationary pressure from the demand side that has not been strong,” he said.