Indonesia Macro Update - INF 01 Mar 2024
KBVS MACRO UPDATE
Friday, 1 March 2024
Inflation in Feb '24 continues to be driven by Rice and Chili*
In Feb '24, the CPI inflation rate experienced an increase to 0.27% MoM or 2.75% YoY (Cons: 0.24% MoM or 2.60% YoY, KBVS: 0.23% MoM or 2.37% YoY, Prev: 0.04% MoM or 2.57% YoY). Furthermore, the domestic increase in rice prices seems to stem from supply constraints. This is evidenced by the realization of paddy field area in 2023 decreasing by -2.29% YoY.
In Mar '24, concerns regarding the increase in rice and chili prices still need to be monitored, alongside the upward trends in Broiler Chicken Meat and Cooking Oil prices, especially with the onset of the Ramadan season in the second week of Mar '24. Nonetheless, the possibility of monthly deflation in the Information and Communication Equipment sector (-1.28% MoM) may not materialize in Mar '24, given the ongoing potential for Rupiah depreciation.
Regards,
Fikri C Permana - KBVS Research Team