- CPI experienced deflation of -0.15% MoM, driven by lower food and transportation prices, while headline inflation rose to 3.55% YoY, mainly driven by a low base effect from electricity tariff discounts.
- Core inflation (ex-gold) eased from the previous month, signaling a potential slowdown in domestic demand in Jan-26. However, consumption momentum is expected to remain supported ahead of the Eid al-Fitr holiday.
- Bank Indonesia is expected to keep the policy rate unchanged at the Feb-2026 meeting due to sustained inflationary pressures and exchange rate volatility.
