Indonesia Macro Update - INF 05 Jan 2026
KBVS MACRO UPDATE
Monday, 5 January 2026
December Inflation Accelerates as Supply Disruptions Dominate
Indonesia’s headline CPI inflation accelerated to 0.64% MoM and 2.92% YoY in Dec ’25, marking a sharp rebound from November and registering the highest YoY inflation since Apr ‘24. On a monthly basis, inflationary pressures were dominated by volatile food and administered prices.
Regional inflation dynamics underscored the significance of supply-side disruptions. Beyond food supply factors, external and seasonal elements also contributed to inflationary pressures.
Looking ahead, inflation risks toward the end of 2025 remain skewed to the supply side. We therefore expect Bank Indonesia to keep the BI Rate unchanged at its current level, where it has remained since 17 September 2025, at the upcoming policy meeting on 20–21 Jan '26.
Regards,
Fikri C. Permana – KBVS Research Team