Every time we shop for daily needs: groceries, electricity, transportation, the prices seem to climb faster than before. What used to feel like everyday purchases now weigh heavier on our wallets. Why, in today’s economic climate, does everything feel so expensive?
Rising Prices & Inflation Trends
According to Indonesia’s Central Statistics Agency (BPS), year-on-year inflation in August 2025 was 2.31 %, up from 1.87 % in June, and still within Bank Indonesia’s target range of 1.5 % to 3.5 %.
That said, certain categories especially food, beverages, and tobacco, were among the largest drivers of inflation.
What people often notice most is that food and daily essentials seem to be rising faster than others especially in markets outside big cities, where supply chain issues and logistics add further cost burdens.
Why Does Everything Feel So Expensive?
- Rising Production & Supply Costs
Costs for fertilizers, energy, transport, and raw materials have surged, putting pressure on farmers, producers, and ultimately your local market.
- Weaker Rupiah & Cost of Imports
When the rupiah depreciates, imported inputs like machinery, fuel, or chemicals, become more expensive, and those costs are passed on to consumers.
- Demand Outpacing Supply
In many regions, demand remains strong while supply (especially for staple foods) struggles due to weather, logistics, or seasonal constraints.
- Limited Government Buffer
While subsidies and price controls exist, they are increasingly under strain due to fiscal constraints. That means less buffer for the most vulnerable.
How Daily Life Feels It:
- Families are reshuffling their shopping lists, giving priority to food, cooking gas, and essential utilities.
- Money for extras education, health, savings, shrinks in many household budgets.
- The burden is most acute for lower- and middle-income groups, and those with fluctuating incomes (e.g. day laborers, small business owners).
Steps We Can Take Together:
- Be efficient at home: Use power, water, and fuel wisely to avoid waste.
- Support local products: Buying from local farmers or producers cuts down transportation costs and strengthens community resilience.
- Stay informed & demand transparency: Know what fair prices look like in your area and speak up when something feels off.
- Advocate for equitable policy: Policies that protect food pricing, improve infrastructure, and support farmers can help cushion the impact for many.