Economist Projects Low Inflation for Indonesia in July 2026

Indonesia's inflation rate in July 2026 is expected to significantly decelerate, according to projections by Bank Mandiri's Chief Economist Andry Asmoro. He forecasts the Consumer Price Index (CPI) to rise by a mere 0.03 percent month-on-month, a sharp decrease from the 0.44 percent recorded in June.

On an annual basis, inflation is anticipated to stand at 3.06 percent year-on-year. This slowdown is attributed to a combination of factors, primarily the expected deflation in volatile food prices and a moderation in government-regulated prices. These decreases are projected to counterbalance a slight increase in core inflation.

Volatile food prices are estimated to experience a deflation of 1.12 percent month-on-month, a reversal from the 0.14 percent inflation seen in June. This is largely due to falling prices for red chili and red onions following the peak harvest season. Meanwhile, government-regulated prices are expected to see a more modest inflation of 0.10 percent month-on-month, down from 1.41 percent in the previous month, as price pressures normalize after the adjustment of non-subsidized fuel prices in June.

However, core inflation is predicted to rise to 0.29 percent month-on-month from 0.23 percent in June. This increase is primarily driven by seasonal educational expenses associated with the start of the new academic year, which are expected to contribute approximately 0.06 percentage points to the overall monthly inflation.

The official inflation data for July 2026, along with other key economic indicators such as export-import data, wholesale price index, farmer's exchange rate, tourism, transportation, and rice and corn harvest figures, will be released by the Central Statistics Agency (BPS) on Monday, August 3, 2026.

“

We predict low domestic inflation in July.