Indonesia’s August Inflation Picks Up, but Stays Below Market Expectation
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Indonesia’s annual inflation rate picked up slightly in August but was below market expectation and remained within the central bank’s target range, statistics bureau data showed on Monday.
Consumer prices rose 3.20 percent in August from a year earlier, compared with July’s annual inflation rate of 3.18 percent. Analysts surveyed by Reuters had expected a rate of 3.33 percent.
Bank Indonesia targets inflation rate in the range of 2.5 percent to 4.5 percent this year.
The consumer price index was down 0.05 percent on a monthly basis due to a drop in food prices, such as that of chicken and chilies, Central Statistics Agency (BPS) head Suhariyanto told a news briefing.
The annual core inflation rate, which excludes prices of government-controlled goods and volatile food, also edged up to 2.90 percent in August, the second month of acceleration and higher than the poll’s estimate of 2.85 percent.
Bank Indonesia Governor Perry Warjiyo has said the rupiah’s slump had not affected prices at least until July. The rupiah has lost nearly 8 percent of its value so far this year and on Monday it was trading at its weakest in 20 years.
Questions & Answers
Q.What was the headline annual inflation rate for Indonesia in August?
What was the headline annual inflation rate for Indonesia in August?
Indonesia's annual inflation rate in August was 3.20 percent. This was a slight increase from July's rate of 3.18 percent, but still fell below market expectations for the month.
Q.How did the August inflation rate compare to Bank Indonesia's target range for the year?
How did the August inflation rate compare to Bank Indonesia's target range for the year?
The 3.20 percent annual inflation rate in August remained within Bank Indonesia's target range. The central bank aims for inflation to be between 2.5 percent and 4.5 percent for the current year.
Q.What caused the consumer price index to decrease on a monthly basis in August?
What caused the consumer price index to decrease on a monthly basis in August?
The consumer price index declined by 0.05 percent month-on-month in August. This decrease was primarily attributed to a drop in the prices of certain food items, such as chicken and chilies.
Q.Has the decline in the rupiah's value impacted prices in Indonesia?
Has the decline in the rupiah's value impacted prices in Indonesia?
According to Bank Indonesia Governor Perry Warjiyo, the rupiah's slump had not affected prices as of July. The currency has lost nearly 8 percent of its value this year, trading at a 20-year low.
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