Inflation picked up pace in March – UOB

Economist at UOB Group Enrico Tanuwidjaja comments on the latest inflation figures in Indonesia.

Key Takeaways

“Food, beverage and tobacco, clothing and footwear as well as personal care and other services prices drove inflation much higher in Mar.”

“Average headline inflation in 1Q22 stood at 2.3% y/y, significantly higher than 4Q21’s 1.8%, while core inflation rose from 1.4% y/y in 4Q21 to 2.1% in 1Q22, indicating some degree of recovery in domestic demand has taken place.”

“Going forward, we expect the headline inflation to reach an average of 3.3% in 2022, within Bank Indonesia’s inflation target range of 2.0%-4.0%, but above its mid-point.”