After the Idul Fitri celebration, general inflation in Indonesia fell to 2,84% (yoy) in May 2024 from 3,00% (yoy) in April 2024 and is still within Bank Indonesia's target range. The general decline in inflation occurred due to reduced consumer demand after Eid al-Fitr and stable food prices due to the harvest season. Meanwhile, the Rupiah depreciated by
2,79% (mtm) between mid-May and mid-June, reaching the lowest level since April 2020, mainly due to the strengthening of the US dollar. Nonetheless, the increase in foreign exchange reserves in May 2024 provides a buffer against exchange rate pressures. BI's triple intervention strategy is expected to help manage Rupiah volatility. We see that BI is necessary
maintained its policy interest rate at 6,25%.
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