March 2026 inflation forecast to drop to around 3.5 percent

Kiswahili

CORE Indonesia projects March 2026 annual inflation at 3.5-3.6 percent, down from February's 4.76 percent. The forecast reflects a low-base effect from electricity tariffs, though Lebaran and non-subsidized fuel prices may push monthly inflation higher. Official BPS data is due on April 1, 2026.

Jakarta – Market players await the official March 2026 inflation data release from Statistics Indonesia (BPS) on Wednesday, April 1, 2026. CORE Indonesia Executive Director Mohammad Faisal forecasts monthly inflation at 0.6 percent (mtm) and annual at 3.5-3.6 percent (yoy).

The annual decline stems from a low-base effect after the early 2025 electricity tariff discount ended in February. "After the discount period ended in February, March sees a monthly inflation spike," Faisal stated.

However, monthly pressures arise from Eid al-Fitr (Lebaran), rising food prices, mudik transportation costs, and non-subsidized fuel (BBM) prices. "Especially during Lebaran, food prices rise, along with transportation costs due to the holiday exodus," he added.

Faisal backs State Secretary Prasetyo Hadi's decision to hold subsidized and non-subsidized BBM prices steady. This is seen as key to mitigating the US-Israel-Iran war's impact on the poor and lower middle class by preserving purchasing power and allocating social assistance.

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