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Indonesia sees monthly deflation in June as food, transportation prices normalize
Statistics Indonesia (BPS) reported a drop in consumer prices in June, reversing part of the seasonal increase seen in May. On an annual basis, the consumer price index (CPI) was up 1.33 percent, lower than a month earlier and below estimates.
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Suradji, 58, a vegetable vendor at Paseban Market in Central Jakarta, sold less chili than usual on Feb. 6, 2020, as the skyrocketing price had reduced demand. (JP/Dzulfiqar Fathur Rahman)
C
onsumer prices declined in June as food and transportation prices normalized after the peak spending period for Ramadan and Idul Fitri in April and May.
Statistics Indonesia (BPS) reported monthly deflation of 0.16 percent in June, reversing much of the 0.32 percent increase seen in May. On an annual basis, the consumer price index (CPI) was up 1.33 percent, also less than a month earlier.
“The deflation in June occurred because it followed Ramadan and Idul Fitri,” newly appointed BPS head Margo Yuwono said in an online press briefing on Thursday. “The COVID-19 pandemic has affected people’s purchasing power, but we see that it was maintained in June, since core inflation was still growing, albeit just a little.”
Last year, Indonesia saw consumer prices fall for three consecutive months from July through September, when restrictions to curb the coronavirus were tightened in many parts of the country.
Read also: Inflation remains low despite Ramadan, Idul Fitri driving demand for food, transportation
The food, beverage and tobacco category posted the highest monthly deflation at 0.71 percent and was also the largest contributor to the monthly decline in the CPI. Red chili, chicken meat, cayenne pepper, shallots, beef and chicken were the main commodities causing the deflation.
The second-largest contributor to deflation was transportation, where prices dropped 0.35 percent month-to-month (mtm). Airfares, intercity land transportation prices and train fares fell in June, offsetting a rise in car prices.
