Indonesia's January inflation highest in almost 3 years
A drone view shows stacks of containers at the Tanjung Priok port in Jakarta, Indonesia, July 10, 2025. REUTERS/Ajeng Dinar Ulfiana
JAKARTA, Feb 2 : Indonesia in January reported its quickest pace of inflation in nearly three years, its statistics bureau said on Monday, as it also released surprisingly strong export and import growth in December.
The inflation rate accelerated to 3.55 per cent in January from 2.92 per cent a month prior, below the 3.78 per cent that was expected by analysts polled by Reuters.
The January reading was slightly above the central bank's target range of 1.5 per cent to 3.5 per cent and marked the fastest pace since May 2023, LSEG Refinitiv data showed.
Inflation in Southeast Asia's largest economy has remained within or under Bank Indonesia's preferred range since mid-2023, allowing the central bank to embark on a rate-cutting cycle amounting to 150 basis points between September 2024 and September 2025.
A senior official at Statistics Indonesia, Ateng Hartono, said the relatively high reading in January was due to a low base effect because the government gave electricity tariff discounts to some customers in the early months of 2025 to help economic growth.
"In March or April, I'm sure inflation rate will normalise as long as there is no other government policy affecting the rate," he said.
The annual core inflation rate, which strips out government-controlled prices and volatile food prices, picked up to 2.45 per cent in January from 2.38 per cent in December. The Reuters poll had expected 2.37 per cent.
STRONG TRADE
In December, exports and imports grew, while analysts expected them to fall.
Exports were up 11.64 per cent from a year earlier to $26.35 billion - the poll expected a decline of 2.40 per cent - thanks to larger shipments of palm oil, nickel, semiconductors and other electric components.
Imports rose 10.81 per cent from a year earlier to $23.83 billion; analysts expected a drop of 0.7 per cent.
The resource-rich country recorded a $2.52 billion trade surplus in December, slightly higher than the poll's $2.45 billion forecast.
Overall, Indonesia posted a trade surplus of $41.05 billion for 2025, up from $31.33 billion a year earlier.
Its trade surplus with the U.S. grew to $18.11 billion in 2025 from $14.52 billion in 2024, despite President Donald Trump's tariffs.
Its surplus with the European Union, with whom Indonesia is about to sign a trade agreement, rose to $6.98 billion from $4.43 billion.
