Fasting Driven Inflation

In my recently trip to Jakarta, I was lucky enough to have a chance to breaking fast or “buka puasa” together with my Muslim friends. It was really nice to wait together with them for the breaking fast moment – which is around 6pm local time. All keep waiting for the TV to announce the time so that we can start to enjoy our delicious dinner.

Food was really nice! According to my friend, local people tend to spend more during the fasting month of Ramadan – although they are not eating anything during the day! During this special month, they prepare more delicious meals, with more variety – in the end of the day, people are simply spending more during the fasting month!

Due to demand for goods and services and constraints on the supply side, traditionally this will result in higher inflation. This is a good lesson I learned in this travel to Jakarta!