Economist: Inflation In November Is A Signal To Improve People's Purchasing Power

Illustration. (Photo: Doc. Antara)

JAKARTA - Paramadina University economist Wijayanto Samirin assessed that inflation in November 2024, which was recorded at 0.30 percent (mtm), is a signal of improving people's purchasing power.

November 2024 inflation is 0.30 percent higher than October 2024 which was 0.08 percent. Until the end of 2024, Wijayanto projected inflation rates in the range of 1.6 percent to 1.7 percent.

"Inflation in 2024 is likely to reach 1.6-1.7 percent, a fairly healthy level. The increase in inflation this November, may be due to the influence of regional elections in various regions in Indonesia," said Wijayanto, quoted from Antara, Tuesday, December 2.

He assessed that the inflation trend would tend to increase in December, due to the impact of Christmas and New Year's.

"Tren akan meningkat di Desember (2024), sebagai dampak Natal dan Tahun Baru. Tetapi, ini (inflasi) masih sehat," jelasnya.

Based on the release of the Central Statistics Agency (BPS), the largest monthly inflation contributor expenditure group in November 2024 was food, beverages, and tobacco with inflation of 0.78 percent and contributed 0.22 percent to inflation.

Commodities that encourage inflation in this group are shallots and tomatoes, each of which contributes 0.10 percent to inflation.

A total of 8 of the 10 main commodities contributing to inflation in November 2024 are commodities from the food, beverage and tobacco group.

Starting from onions and tomatoes 0.10 percent each, chicken meat 0.03 percent, cooking oil 0.03 percent, then garlic, fresh fish, machine kretek cigarettes (SKM), and powder coffee, respectively 0.01 percent.

Several commodities of the food, beverage and tobacco group that contributed the main contributor to inflation in November 2024 were onions 24.87 percent, tomatoes 58.88 percent, chicken meat 2.03 percent, and cooking oil 2.17 percent.

This shows that onion, tomatoes and chicken meat have been inflationing again in the last two months, while cooking oil has been experiencing inflation since July 2024 with the November inflation rate being the highest inflation rate so far this year.

"Inflation of cooking oil because global CPO price index has indeed increased in recent months, year-to-date has increased by 10.7 percent. So, cooking oil prices have different behaviors than other products," said Wijayanto.

Previously, the Head of BPS Amalia Adininggar Widyasanti stated that the annual inflation rate in November 2024 was 1.55 percent (yoy).

"There was an increase in the Consumer Price Index (JCI) from 104.71 in November 2023 to 106.33 in November 2024," he said.

Based on the expenditure group, annual inflation is driven by food, beverage and tobacco groups with inflation of 1.68 percent and contributes 0.48 percent to general inflation.

Commodities with the largest share of inflation in this group are SKM with a share of 0.13 percent, rice and shallots each contributing 0.11 percent.

Other commodities that also contributed to inflation were powdered coffee 0.10 percent, cooking oil 0.09 percent, tomatoes and garlic 0.06 percent, and chicken meat 0.05 percent, respectively.

Outside the food, beverage and tobacco group, other commodities that contributed significantly were gold jewelery and rice with side dishes of 0.36 percent and 0.06 percent, respectively.

Annual inflation in November 2024 also occurred in all components, starting from the core component that experienced annual inflation of 2.26 percent. This component contributes the largest inflation with an inflationary contribution of 1.44 percent with commodity dominance, including gold jewelery, powder coffee, cooking oil, rice with side dishes, and home rental.