Head of the Central Bureau of Statistics, Suhariyanto, has said that the people’s purchasing power is still continuing to weaken, following two months of back-to-back deflation.


"At the moment, the trend is almost the same, there is a weakening of purchasing power. There are slowdowns and deflation," he said at a press conference here on Tuesday.

The main cause for this is the COVID-19 pandemic, which has strained people's incomes and reduced the demand for consumption goods, he explained.

The weak purchasing power is also reflected in the main year-on-year inflation, which has been recorded at 2.03 percent, or lower from the previous average.

The bureau had earlier recorded back-to-back deflation in July and August of 0.10 percent and 0.05 percent, respectively, due to a decline in prices of food products and air travel tariffs.

The downward trend in inflation has been apparent since the COVID-19 pandemic began in Indonesia in March this year and has affected economic performance.

The slowdown had even affected inflation during the Eid Al-Fitr period, which sloped in April and May, 2020 by just 0.08 percent and 0.07 percent, respectively.

Normally, there is high inflation during the festive holiday period due to an increase in food prices and transportation rates, in line with high demand.

With the occurrence of deflation, inflation for the calendar year January to August, 2020 has reached 0.93 percent and year-on-year inflation (yoy) has reached 1.32 percent. (INE)

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Reporter: Satyagraha/Aria Cindyara
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