TheJakartaPost
Please Update your browser
Your browser is out of date, and may not be compatible with our website. A list of the most popular web browsers can be found below.
Just click on the icons to get to the download page.
Electricity subsidies keep consumer prices subdued in February
Last month marks the first month of annual deflation since March 2000, BPS said.
Change text size
Gift Premium Articles
to Anyone
Share the best of The Jakarta Post with friends, family, or colleagues. As a subscriber, you can gift 3 to 5 articles each month that anyone can read—no subscription needed!
Employees of state-owned electricity company PLN check an electricity meter in 2020 at a customer’s house on Jl. Namburan Lor, in Panembahan subdistrict, Kraton district, Yogyakarta. (JP/R. Berto Wedhatama)
I
ndonesia has experienced its first month of annual deflation in 25 years, but what pushed consumer prices down in February was largely a 50 percent electricity discount implemented for the first two months of the year.
Statistics Indonesia (BPS) head Amalia Adininggar Widyasanti announced at a press conference on Monday that the country's consumer price index (CPI) declined by 0.09 percent year-on-year (yoy) in February.
The figure is lower than Moody’s Analytics’ forecast of a 0.7 percent increase.
It is also far below the central bank’s inflation target range of 1.5 to 3.5 percent rise.
Electricity prices were down 46.45 percent yoy and that alone brought the headline inflation rate down by 2.16 percentage points, according to BPS.
The agency dismissed concerns that the deflation was caused by weakening consumer spending power.
“Purchasing power is typically linked to core inflation, which still saw an increase to 2.48 percent yoy in February,” Amalia said. “The biggest contributor to deflation [this month] remains the electricity discount, as reflected in the 9.02 percent deflation in the administered prices component.”
