Annual Core Inflation Falls to 1.4% in July 2021

The Central Statistics Agency (BPS) recorded core inflation in July 2021 at 1.4% year-on-year (yoy). This figure decreased by 0.09% from the previous month's 1.49%. Similarly, compared to July 2020, core inflation decreased by 0.67 percentage points from 2.07%.

Meanwhile, core inflation month-on-month (mom) was 0.07%. This figure also decreased from the previous month's 0.14%. Cumulative to date (ctc) core inflation was 0.82%, up from 0.76% the previous month.

Core inflation is a component of inflation that tends to be stable and is influenced by fundamental factors such as the interaction of supply and demand, the external environment, and inflation expectations of traders and consumers.

In addition to core inflation, there is volatile component inflation and government-regulated price inflation. Volatile component inflation is influenced by shocks from the food commodity group. In July 2021, this inflation rate was 2.97% (yoy), 1.14% (ctc), and 0.14% (mom).

Meanwhile, government-regulated price inflation is influenced by shocks from government policies. This inflation rate was 0.61% (yoy), 0.46% (ctc), and 0.05% (mom).

As a result, Indonesia's overall inflation in July 2021 was 0.08% (mom), 0.81% (ctc), and 1.52% (yoy).