Indonesia September Inflation Rises to 3.28 Percent

Indonesia's annual inflation rate increased to 3.28 percent in September, up from 3.19 percent in August, according to official data released October 1. The rise was primarily driven by higher costs for fuel and food staples, specifically rice, chillies, chicken, and fish.

Despite the increase, the figure aligned with market expectations and stayed within the 1.5 percent to 3.5 percent target range set by Bank Indonesia. In contrast, the annual core inflation rate, which excludes government-controlled prices and volatile food costs, decreased to 2.84 percent from 2.92 percent in August.

To support the rupiah and maintain inflation targets through 2027, Bank Indonesia raised policy rates by 100 basis points between May and June. Additionally, the Government of Indonesia utilized energy subsidies to mitigate price pressures caused by elevated global crude oil prices.