Indonesia Macro Update - INF 01 Jul 2026
KBVS MACRO UPDATE
Wednesday, 1 July 2026
Inflation Picks Up on Fuel Price Hike and Weaker Food Supply
Indonesia’s headline inflation accelerated more than expected in Jun ‘26, rising to 0.44% MoM and lifting annual inflation to 3.34% YoY. Administered Prices were the main driver, rising 1.41% MoM, mainly reflected higher non-subsidized fuel prices and airfares following Pertamina's two fuel price adjustments during the month. Food inflation remained elevated amid higher imported food costs and domestic supply shortages.
June's stronger-than-expected inflation print reinforces our expectation that Bank Indonesia will maintain a hawkish hold at its upcoming policy meeting. Looking ahead, we expect inflation to remain elevated over the next few months, although the pace of acceleration should moderate as the one-off impact of fuel price adjustments gradually fades.
Regards,
Khairunnisa N Syahfiraputri & Anggun Rahmadani - KBVS Research Team