Predicting Monthly Inflation Trends in Indonesia: An ARIMA Approach
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Abstract
Inflation is the decline in the value of paper money due to the rapid increase in the amount of money in circulation, which leads to rising prices of goods. Inflation is a key indicator in a country's economy. Inflation instability can disrupt the economic decisions of businesses and the public, making accurate predictions essential. Monthly inflation data from January 2021 to October 2024, obtained from Bank Indonesia, is analyzed using the ARIMA model. This model is chosen for its statistical efficiency in forecasting time series data. The aim of this study is to predict Indonesia’s inflation rate from November 2024 to May 2025 using the ARIMA (Autoregressive Integrated Moving Average) method.
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