Indonesia: Inflation unexpectedly recedes in April – UOB

UOB Group’s Economist Enrico Tanuwidjaja and Junior Economist Agus Santoso review the latest release of inflation figures in Indonesia.

Key Takeaways

“Somewhat uncanny during a festive month, Indonesia's headline inflation bucked its typical trend, easing to 4.3% y/y in Apr from 5% in Mar, chiefly due to lower and stable food & transportation prices as the government managed better the logistics last month.”

“This was duly reflected with food and transportation inflation moderating markedly to 4.6% and 12% y/y viz the previous month's 6.1% and 13.7% y/y.”

“April’s inflation data reinforces our 2023 inflation forecast of 4% (2022: 4.2%). Our view remains for inflation to edge back to be within BI’s target range of 2-4% in 2H23.”