Bank Indonesia Confirms May 2026 Inflation Remains Stable Due to Consistent Policy with Government

Bank Indonesia has confirmed that the Consumer Price Index (CPI) inflation for May 2026 remained within the target range of 1.5 per cent to 3.5 per cent. This achievement is the result of consistent monetary policy and close synergy in inflation control.

Ramdan Denny Prakoso, Executive Director of Bank Indonesia’s Communications Department, stated that Bank Indonesia is working alongside central and regional governments through the Central and Regional Inflation Control Teams (TPIP and TPID). “Bank Indonesia and the government are also strengthening the implementation of the National Food Security Programme,” Ramdan noted in a statement on Tuesday, 2 June 2026.

The central bank remains confident that inflation will remain controlled within the target range of 2.5 per cent, plus or minus 1 per cent, or a range of 1.5 per cent to 3.5 per cent, throughout 2026 and 2027.

According to data released by Statistics Indonesia (BPS) on Tuesday (2/6/2026), the CPI in May 2026 recorded a monthly inflation rate of 0.28 per cent (month-to-month), resulting in an annual inflation rate of 3.08 per cent (year-on-year).

Core inflation in May 2026 was recorded at 0.22 per cent (m/m), slightly lower than the previous month’s 0.23 per cent (m/m). This development in core inflation was primarily influenced by rising cooking oil prices amidst maintained inflation expectations. On an annual basis, core inflation in May 2026 was recorded at 2.59 per cent (y/y), higher than the previous month’s 2.44 per cent (y/y).

Furthermore, the volatile food group in May 2026 experienced inflation of 0.22 per cent (m/m), higher than the previous month’s deflation of 0.88 per cent (m/m). Inflation in the volatile food group was mainly driven by commodities such as red chilli, shallots, tomatoes, and rice, due to supply decreases caused by production disruptions from extreme weather and the end of the peak harvest season, alongside increased demand during the Eid al-Adha religious holiday.

Annually, the volatile food group experienced inflation of 6.24 per cent (y/y), higher than the previous month’s 3.37 per cent (y/y). Bank Indonesia stated that moving forward, volatile food inflation is expected to remain controlled, supported by the close synergy between Bank Indonesia, TPIP, and TPID, as well as the strengthened implementation of the Inflation Control and Prosperous Food Movement (GPIPS).