On the back of Lebaran-related activities, August Consumer Price Index (CPI) soared to 0.95percent month-on-month compared to July’s level of 0.7 percent, translating to year-on-year CPI of 4.58 percent, slightly higher than July’s 4.56 percent due to increases in staple food, clothes, education and transportation prices.  August figure was higher than our estimate of 0.68 percent month-on-month and consensus’ expectation of 0.8 percent.  

August core inflation surged to 0.97 percent month-on-month, much higher than previous month of 0.53 percent, propelled by transportation and recreational costs during Lebaran. Additionally, education costs also increased in the new academic year.  However, on a year-on-year basis, core inflation declined to 4.16 percent on lower base effect (exhibit 1).

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