What caused the -0.03 percent month-on-month (m/m) deflation rate in May 2024? Well, there are two clear factors. Firstly, the food, drinks and tobacco expenditure group showed deflation of -0.29 percent (m/m) in May 2024. This certainly is not a surprise as we typically see deflation in this group in the month after Idul Fitri. After the Idul Fitri celebrations consumers tend to refocus on saving their money rather than spending it on food and other consumer goods (such as clothes).

Moreover, May 2024 still enjoyed the impact of the harvest season. This particularly had a positive impact on prices of rice (which contracted by 0.15 percent m/m). But amid lower demand in society after Idul Fitri, chicken meat and fresh fish prices also fell, as did prices of tomatoes, potatoes and green chili peppers (cabai rawit).


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