June 1, 2026 | 03:19 pm
TEMPO.CO, Jakarta – Bank Mandiri’s Office of Chief Economist (OCE) projects that Indonesia’s annual inflation will rise to 3.21 percent year-on-year in May 2026, up from 2.42 percent in the previous month. Monthly inflation is also forecast to increase to 0.40 percent month-to-month, from 0.13 percent in April.The economists said the increase was mainly driven by a surge in airfares and a shift in volatile food prices from deflation to mild inflation.“This increase in inflation is mainly driven by a spike in airline ticket prices and rising volatile food prices, which moved from deflation to mild inflation,” Bank Mandiri’s OCE said in its analysis on Monday, June 1, 2026. Volatile food inflation is expected to rise 0.20 percent month-to-month, reversing a 0.88 percent deflation in April.According to the economists, the uptick in food prices was driven by several commodities, including a 23 percent increase in red chili prices, 4.1 percent in shallots, 0.4 percent in beef, and 0.3 percent in rice.Core inflation is projected to ease to 0.19 percent month-to-month, lower than 0.23 percent in the previous month. The OCE attributed this to lower gold prices and rupiah depreciation.Meanwhile, administered prices are expected to rise 1.3 percent month-to-month, up from 0.69 percent in April. The increase is largely driven by higher airfares, which are projected to jump 35.31 percent due to rising global oil prices.The Statistics Indonesia (BPS) is scheduled to announce official May inflation data on Tuesday, June 2, 2026. In April 2026, annual inflation stood at 2.42 percent.By expenditure category, inflation was mainly driven by food, beverages, and tobacco, contributing 0.9 percentage points with inflation of 3.06 percent. Personal care and other services followed, contributing 0.77 percentage points with inflation of 11.43 percent.“This group’s inflation was mainly driven by jewelry gold prices,” said BPS Deputy for Distribution and Services Statistics Ateng Hartono at the BPS office in Jakarta on Monday, May 4, 2026.Mutia Yuantisya contributed to the writing of this article.Read: Prabowo Says He's Ready to Confront Illegal Business Practices
