Bank Indonesia Optimistic Inflation Will Remain Under Control in 2026, Ramadan to Stay Conducive
By Aulia Rahmah)
Maintaining inflation stability during the Ramadan period is a strategic step by the government in safeguarding national economic resilience. Ramadan and Eid al-Fitr are always associated with increased public consumption, particularly in the food and essential goods sectors. In such circumstances, policy consistency and inter-agency coordination are crucial to ensure that rising demand does not translate into price hikes that burden people’s purchasing power. The commitment of the government and monetary authorities to keep inflation under control serves as an essential foundation for social stability and sustainable economic growth.
From a monetary policy perspective, Deputy Governor of Bank Indonesia, Aida S. Budiman, emphasized that inflation throughout 2026 is projected to remain well managed and even stay below 3 percent. This optimism reflects confidence that Indonesia’s economic fundamentals remain solid. Nevertheless, there is a technical factor that warrants attention—namely the base effect from the electricity tariff discount policy implemented in January and February 2025, which affects the year-on-year inflation calculation in early 2026. As a result, January’s inflation may appear slightly above target, but this is temporary and does not indicate excessive demand pressures.
Understanding this base effect is important to prevent misinterpretation of short-term inflation figures. The uptick is largely driven by administered prices rather than an imbalance between supply and demand. Therefore, monetary policy remains prudent and well-calibrated, with a strong focus on anchoring inflation expectations. During Ramadan, such stability becomes especially critical, as it directly affects the daily necessities of the broader population.
On the supply side, national food conditions are relatively supportive of inflation control efforts. Several strategic horticultural commodities—such as shallots, red chilies, and bird’s eye chilies—are currently in harvest season. This situation helps maintain adequate market supply while easing potential price pressures. Bank Indonesia also actively conducts weekly price monitoring to ensure that price movements remain within projected ranges. This demonstrates a proactive rather than reactive approach in safeguarding price stability during sensitive periods like Ramadan.
Strengthened coordination also plays a vital role in the inflation control strategy. Bank Indonesia continues to reinforce synergy through the Central Inflation Control Team (TPIP) and Regional Inflation Control Teams (TPID) in collaboration with ministries and local governments. Additionally, the launch of the Inflation Control and Prosperous Food Movement underscores the government’s commitment to strengthening food resilience, particularly by enhancing supply and improving distribution channels. Implementation of this program across various regions is expected to close distribution gaps that often trigger price spikes during specific moments.
At the regional level, the commitment to maintaining inflation is equally evident. Economic and Development Advisor of South Kalimantan, Miftahul Chair, stated that inflation in the province remains under control. Strategic commodities such as shallots, bird’s eye chilies, chicken, and beef are considered relatively stable, showing no significant price surges. Local governments continue to prepare anticipatory measures throughout Ramadan to ensure that staple goods remain available. These efforts are crucial to protect household purchasing power from unnecessary price increases.
Inflation control at the regional level cannot be separated from the active role of provincial and district governments. Market operations, distribution supervision, and coordination with business actors are essential instruments in maintaining price stability. When central and regional policies move in harmony, the potential for price volatility can be effectively mitigated. This alignment also strengthens public confidence that the state is present in ensuring access to basic necessities.
From the legislative side, Chairman of Commission XI of the House of Representatives (DPR RI), Mukhamad Misbakhun, stressed that inflation control and the protection of purchasing power must remain top priorities in national economic policy. According to him, increased consumption during Ramadan is an annual and predictable pattern, requiring the state to respond early with appropriate policy instruments. Price stability, he noted, is closely linked to people’s peace of mind in observing religious practices and celebrating the festive season.
Inflation stability also carries broad implications for regional economic circulation. When prices remain stable, business activities can proceed more smoothly, contributing positively to local economic growth. Traders, farmers, and small and medium enterprises can plan their activities with greater certainty. Ultimately, this fosters a healthy and inclusive economic cycle, where the benefits of growth are shared across various segments of society.
With the range of measures already undertaken, the commitment to maintaining inflation stability during Ramadan demonstrates that national economic management is being carried out with careful planning. Challenges will always exist, but through strong coordination, anticipatory policies, and clear public communication, price stability can be preserved. Ramadan should serve as a moment of strengthened social solidarity and inner peace—not concern over rising prices of essential goods. Therefore, the government’s commitment to controlling inflation remains an integral part of ensuring sustainable public welfare.
) The author is an economic policy analyst.
