January 2023 Inflation at 5.28%, Still Far from BI's Target

The Central Statistics Agency (BPS) reported that Indonesia experienced a 5.28% year-on-year (yoy) inflation in January 2023.

Although lower than in December 2022, inflation at the beginning of this year is still significantly higher than in 2020-2021, as shown in the graph.

The figure is also far from Bank Indonesia's (BI) target of suppressing inflation to the range of 3±1% in the first half of 2023.

"The prices of various commodities in January 2023 generally showed an increase," said BPS in its report.

According to BPS, the commodities that contributed significantly to inflation at the beginning of this year were rice, red chilies, shallots, fresh fish, chicken eggs, raw tofu, white cigarettes, and kretek filter cigarettes.

Inflation was also influenced by price increases in house contracts, piped water tariffs, household fuel, house rent, powdered/liquid detergent, gasoline, cars, airfare, city transportation fares, academy/university tuition fees, rice with side dishes, and gold jewelry.

Here is a breakdown of the annual price increase or inflation rate in January 2023 by expenditure group, ordered from highest to lowest:

* Transportation: 13.91% (yoy)
* Personal care and other services: 6.15% (yoy)
* Food, beverages, and tobacco: 5.82% (yoy)
* Food and beverage service/restaurants: 4.46% (yoy)
* Household equipment, appliances, and routine maintenance: 4.28% (yoy)
* Housing, water, electricity, and household fuel: 3.62% (yoy)
* Health: 3.04% (yoy)
* Recreation, sports, and culture: 2.87% (yoy)
* Education: 2.80% (yoy)
* Clothing and footwear: 1.07% (yoy)

Only one expenditure group experienced a year-on-year deflation in January 2023, namely information, communication, and financial services, with a deflation of 0.22% (yoy).