Indonesia: BI says Jan 20 inflation to hit four-year low

  • Bank Indonesia (BI) expects the Jan 20 inflation rate to remain low, despite an increase in food prices as a result of major flooding in many parts of the country.
  • BI Governor Perry Warjiyo estimated a 0.41% m/m increase in the Jan 20 inflation, “the lowest level since 2016”, he said on 10 Jan 20 in Jakarta. He added that annual inflation in 2020 was projected to remain low at 3%, slightly above the 2019 inflation rate of 2.72%.
  • The 2019 inflation rate is the lowest in two decades and falls within the central bank’s targeted inflation rate of 2.5 to 4.5%. Statistics Indonesia head Suhariyanto attributed the low annual inflation to the government’s policies, which helped to control prices.
  • Perry acknowledged that widespread flooding in Jan 20 would increase the prices of some foods, such as chilies and onions, but that the hike would not significantly impact the inflation rate because of a decline in the prices of other commodities.

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