Video: War Looms, Inflation Forecast to Surge – Interest Rates Could Rise

In the midst of the US-Israel war against Iran that has pushed up global oil prices until the Eid al-Fitr and Ramadan period, Indonesia’s inflation in March 2026 is predicted to increase. CNBC Indonesia economist Maesaroh stated that inflationary pressures have been rising since February 2026 alongside the Ramadan period, while in March they will intensify to around 0.3-0.4% (month-to-month). Food inflation will be the main driver, extending to services and air ticket prices. Additionally, the spike in global crude oil prices will raise non-subsidised fuel prices and possibly subsidised fuel prices due to the state budget’s capacity to absorb oil price pressures. Economic data developments and this inflation rise could affect the central bank’s benchmark interest rate policy. Even the Federal Reserve is forecast to raise interest rates if economic pressures mount further. Meanwhile, Bank Indonesia’s BI Rate policy will also be linked to fuel pricing policies and the rupiah exchange rate position, potentially following the Federal Reserve’s lead.