JAKARTA (TheInsiderStories)–Indonesia recorded low inflation of 0.21 per cent on-year in May 2018, reflecting low people’s purchasing power.
The consumer price index (CPI) recorded 132.99 in May 2018. While, inflation recorded 1.3 per cent in year to date and 3.23 per cent in the year on year.
This inflation is considerably lower compared to the inflation in the Ramadan in the last three years, said Head of the Central Statistics Agency Suhariyanto on Monday (04/06). Monthly inflation rate recorded 0.39 per cent in Ramadan 2017, 0.66 per cent in Ramadan 2016, and 0.54 per cent in Ramadan 2015.
Ramadan is the ninth month of Islamic calendar where the people usually spend a lot of money to welcome Ied Fitr which falls right after Ramadan. This tradition generates accelerating inflation in the past years.
The low rate of inflation during Ramadan indicated the low people’s purchasing power. Based on data from the Statistics Indonesia, household consumption grew only 4.95 per cent in the first quarter of 2018, which was almost stagnant if compared to consumption rate in the first quarter last year at 4.94 percent.
However, the monthly inflation rate in May 2018 was higher than April 2018 at 0.1 per cent. The acceleration in a month to month inflation is likely due to the rupiah depreciation against the US Dollar. The rupiah depreciation brings impact to the increase of imports and accelerates inflation.
Rupiah had surpassed the psychological level of Rp14,000 last month. In the last day trading last week, rupiah closed up 2.2 per cent from the highest position of Rp14,209 in the previous day.
Suhariyando added the biggest share of inflation was contributed by the food, beverage, cigarette, and tobacco by 0.05 per cent. Meanwhile, housing, water, electricity, gas, and fuel inflation by 0.05 per cent. Each group experienced inflation of 0.31 per cent and 0.19 per cent, respectively.
“The highest inflation was contributed by the clothing group of 0.33 per cent,” he said.
In addition, the food category experience inflation of 0.21 per cent with a share of 0.04 per cent, including chicken meat, eggs, fish, and onion. Education, recreation, and sport groups experienced inflation of 0.09 per cent with 0.01 per cent share, while the health sector by 0.21 per cent with 0.01 per cent share. The transportation, communication, and financial service experience inflation of 0.18 per cent with a share of 0.03 per cent.
The administered price experienced inflation of 0.27 per cent, core inflation by 0.21 per cent, and volatile foods by 0.19 per cent deflation.