LPEM UI: Herd Immunity Is Still Far, People Choose To Save And Hold Shopping

Illustration (Photo: By Courtesy)

JAKARTA - The Institute for Economic and Community Research, University of Indonesia (LPEM UI) revealed a study related to the inflation rate that occurred during the period March 2021.

In his explanation, the think tank explained that the slowing rate of inflation was due to demand that had not yet recovered amid the COVID-19 pandemic.

Also, the development of the number of vaccinations, which has now reached 10 million vaccinations, is a good signal for economic recovery.

However, this number is still far from the threshold herd immunity, with the condition that 181 million people or 360 million vaccinations (two doses).

"This is what makes people continue to hold their consumption and choose to save", wrote the LPEM UI report as quoted by VOI, Tuesday, April 6.

Furthermore, efforts to accelerate vaccination to achieve herd immunity are an important key to economic recovery, as inflation eased during this period due to weak demand.

"We predict that inflation will be in the range of 1.3-1.5 percent year-on-year (YoY). Meanwhile, moderate inflation (month-to-month/MoM) will occur in the April 2020 period with increasing public consumption with the entry of the Ramadan period", he said.

As previously reported, the Central Statistics Agency (BPS) recorded an inflation of 0.08 percent every month in March 2021.

Deputy for Distribution and Services Statistics, BPS Setianto, said that this inflation was lower than the inflation in February 2021 which was 0.10 percent, MoM.

Based on the data, inflation on a calendar year basis or year-to-date (YTD) until last March was 0.44 percent. Meanwhile, inflation on an annual basis or YoY was 1.37 percent.

"On a month-to-month basis, there is a decrease in inflation from the beginning of the year to March 2021. Inflation in January 2021 is 0.26 percent mom, decreasing in February 2021, and falling again in March 2021", he said in a virtual press conference, Thursday, April 1.

Of the 90 cities surveyed by the BPS Consumer Price Index (CPI), 58 cities experienced inflation while 32 other cities experienced deflation. The highest inflation occurred in Jayapura with 1.07 percent, while the lowest inflation was in Tangerang and Banjarmasin with 0.01 percent respectively.

"Of the 32 cities, the highest deflation was in Baubau, namely minus 0.99 percent, while the lowest deflation was in Palopo which was minus 0.01 percent", he said.