Highlights of August 2018’s Inflation

Indonesia posted the deflation of 0.05% m-m in August 2018. The August’s inflation is lower than the July’s inflation of 0.28% m-m aligning with the monthly cycle. On the yearly basis, the August 2018’s inflation is at 3.20% lower than the August 2017’s inflation of 3.82%.

The August’s deflation is mainly driven by the deflation posted by the foodstuff, clothes and transportation, communication and financial services segments. The foodstuff segment records the highest deflation of 1.10%.


Post-Idul Fitri Monthly Inflation Pressure

We oversee that the trend of hike in monthly inflation occurred post-Idul Fitri 2018 compared to the post-Idul Fitri 2017. On Idul Fitri 2018 (June 2018), the monthly inflation was at 0.59% lower than the inflation of 0.69% on Idul Fitri 2017 (June 2017).

However, the July and August 2018’s inflation settled at 0.28% and –0.05%, respectively or higher than the July and August’s 2017’s inflation of 0.22% and 0.77%, respectively. The backdrop signals that the trend of rupiah depreciation gradually starts to have impact on the higher inflation.

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