Important Announcement Due Tomorrow, Hope It's Not Bad News

Indonesia’s inflation is expected to rise in May 2026 amid Eid al-Adha celebrations, a weakening rupiah, and higher non-subsidised fuel prices. The Central Statistics Agency (BPS) is scheduled to release May 2026 inflation data tomorrow, Tuesday (2 June 2026). Market consensus compiled by CNBC Indonesia from 10 institutions forecasts a monthly inflation rate of 0.19% for May 2026’s Consumer Price Index (CPI), with a median annual inflation rate of 2.93%. In April 2026, Indonesia recorded 0.13% monthly inflation, with annual inflation at 2.42% and core inflation at 2.44%. Bank Mandiri chief economist Andry Asmoro explained that monthly inflation was driven by rising food items and airfare prices. Rising onions and rice contributed to inflation, while egg and chicken prices fell. ‘Gold price declines have kept core inflation in check, but the rupiah’s weakness continues to push up import prices,’ Asmoro told CNBC Indonesia. The rupiah weakened by 3.28% in May 2026, its worst performance since October 2024. Bank Permata chief economist Josua Pardede said annual inflation would rise slightly as cost pressures become more evident for consumers. ‘May’s inflation drivers are primarily supply and cost-related, not sharp increases in consumer demand. Pressures stem from higher raw material costs, rupiah depreciation raising import input prices, persistent high energy costs, and seasonal demand ahead of Eid al-Adha,’ he added. He added that volatile food prices are expected to rise again due to increased food demand during Eid al-Adha on 27 May 2026. Government-regulated prices may also rise due to non-subsidised fuel, energy costs, and airfare tariffs driven by high jet fuel prices. PT Pertamina (Persero) officially raised non-subsidised fuel prices at petrol stations on 4 May 2026. The increases affected RON 98 (Turbo) and non-subsidised diesel products. For example, Pertamax Turbo (RON 98) in Jakarta is now priced at Rp19,900 per litre, up from Rp19,400. Dexlite increased to Rp26,000 per litre from Rp23,600. Data from the National Strategic Food Price Information Centre (PIHPSN) showed significant rises in rice and shallot prices. Average rice prices stood at Rp15,959 per kg in May 2026, a 0.2% increase from April. Shallot prices rose 2.3% to Rp47,773 per kg, while chicken meat prices fell 3.4% to Rp39,140 per kg.