Indonesia’s inflation landscape remained subdued in March, with the annual rate recorded at 1.03%, below both market expectations and the central bank’s designated target range.
The figure, provided by the country’s statistics bureau on Tuesday, fell short of the anticipated 1.17%, as per a Reuters analysts poll. This marks the third consecutive month inflation has been below Bank Indonesia’s target range of 1.5% to 3.5%.
The beginning of 2025 saw notably low inflation rates, propelled by government interventions such as substantial discounts on electricity prices, which resulted in the country’s first annual deflation reading in over twenty years this past February.
Although the electricity discount ended in March, residual effects on consumer costs for some users continued to influence the inflation figures, as explained by the statistics bureau.
Authorities attributed these low inflation numbers to effective government policies rather than diminished consumer demand, pointing to resilient core inflation levels as evidence. The annual core inflation rate in March stood at 2.48%, consistent with February’s data and analysts’ forecasts.
In Indonesia, a nation with the world’s largest Muslim population, consumer demand typically spikes leading up to the Eid al-Fitr festivities, which this year occurred in late March.
