Purbaya to Maintain 2027 Inflation Within 1.5 to 3.5 Percent Range

The government has targeted national economic growth within a range of 5.8 to 6.5 percent, as outlined in the Macroeconomic Framework and Fiscal Policy Principles (KEM-PPKF) for the 2027 fiscal year. This also includes other targets such as the 10-year government bond yield set between 6.5 and 7.3 percent, the rupiah exchange rate targeted at Rp 16,800 to Rp 17,500 against the US dollar, and inflation targeted between 1.5 and 3.5 percent. Finance Minister Purbaya Yudhi Sadewa stated during a working meeting with the Budget Committee (Banggar) of the Indonesian House of Representatives in Senayan, Jakarta, on Tuesday, 9 June 2026, that with sound economic strategy and prudent, sustainable fiscal policy, the government is optimistic Indonesia’s economy can grow strongly within the 5.8 to 6.5 percent range in 2027. To address ongoing global uncertainty, the government has prepared several strategic policies, including measures to maintain price stability for subsidised fuel and food, ensuring energy availability and rice stocks, and controlling the state budget deficit below 3 percent of GDP. Further steps include improving state spending efficiency, optimising natural resource-based revenues, providing stimulus to maintain public purchasing power, accelerating budget absorption, and strengthening fiscal and monetary policy synergy. Accordingly, the 2027 basic macroeconomic assumptions are set as follows: economic growth of 5.8 to 6.5 percent; inflation of 1.5 to 3.5 percent; 10-year government bond yield of 6.5 to 7.3 percent; exchange rate of Rp 16,800 to Rp 17,500 against the US dollar; Indonesian crude oil price of 70 to 95 US dollars per barrel; oil lifting of 602,000 to 615,000 barrels per day; and natural gas lifting of 934,000 to 977,000 barrels of oil equivalent per day. Purbaya stated that the 2027 fiscal policy will focus on driving higher economic growth while accelerating improvements in public welfare. The 2027 fiscal posture is detailed as follows: a state budget deficit of 1.8 to 2.4 percent of gross domestic product (GDP); state revenue of 11.82 to 12.40 percent of GDP; and state expenditure of 13.62 to 14.80 percent of GDP. In the social welfare sector, the government has set development target indicators accordingly.