September 2, 2025 | 01:50 pm
TEMPO.CO, Jakarta - Bank Indonesia (BI) claims that the inflation rate of 2.31 percent in August 2025 (year on year) is the result of the consistent monetary policy and the close synergy in controlling inflation between the central bank and the government. The control of inflation between BI and the government is achieved, among other measures, through the National Movement for Controlling Food Inflation (GNPIP) in various regions.
"In the future, Bank Indonesia ensures that inflation will remain under control within the target range of 2.5 plus or minus 1 percent in 2025 and 2026," said the Executive Director of BI's Communication Department, Ramdan Denny Prakoso, in his statement in Jakarta on Tuesday, September 2, 2025, as quoted from Antara.
Previously, Statistics Indonesia (BPS) announced that the Consumer Price Index (CPI) in August 2025 recorded a deflation of 0.08 percent (month-to-month). Thus, the annual inflation rate of the CPI decreased to 2.31 percent (yoy). BI noted that the inflation in August 2025 remained within the target range.
Meanwhile, the core inflation group in August 2025 recorded a 0.06 percent (mtm) increase, lower than the previous month's realization of 0.13 percent (mtm). In August 2025, the increase in core inflation was primarily driven by rising education costs, including academic and higher education tuition fees, as well as gold jewelry prices.
The increase in inflation is influenced by seasonal factors, such as the start of the new academic year and the rise in global gold prices, amid expectations of sustained inflation. Annual core inflation in August 2025 recorded at 2.17 percent yoy, a decrease from the previous month's inflation of 2.32 percent (yoy).
On the other hand, the volatile food group in August 2025 experienced a deflation of 0.61 percent (mtm), a decrease from the previous month's inflation of 1.25 percent (mtm). Deflation in the volatile food group is due, in part, to lower prices of tomato, bird's eye chili, and garlic commodities. This is due to an increased supply during the horticultural commodity harvest period and the realization of garlic imports.
Meanwhile, on an annual basis, the volatile food group saw inflation rise by 4.47 percent (yoy), and 3.82 percent (yoy) inflation was seen the previous month. "In the future, volatile food inflation is predicted to remain controlled, supported by the close synergy between Bank Indonesia and the Central and Regional Inflation Control Teams (TPIP and TPID) through the GNPIP in various regions," said Ramdan.
Deflation also occurred in the administered prices group. Based on BPS records, the administered prices group experienced a deflation of 0.08 percent (mtm) in August 2025, a decrease from the previous month's inflation of 0.09 percent (mtm).
Deflation in the administered prices group is primarily due to lower airfare and gasoline prices. This development is driven by the implementation of discounted airline ticket prices in celebration of the 2025 Indonesian Independence Day and the adjustment of non-subsidized fuel prices. On an annual basis, the administered prices group recorded an inflation of 1.00 percent (yoy), lower than the previous month's 1.32 percent inflation (yoy).
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