Indonesian Inflation Rising – Rate Cut by Central Bank Unlikely

Indonesia’s headline inflation rate is forecast to have continued accelerating in February, economists and a high-level government official said on Thursday.

Inflation already accelerated in January, with the consumer price index rising 4.57 percent year-on-year to the highest rate in three months. That compared to a 4.3 percent rise in December.

January’s rise was attributed to supply disruptions following major wet season rains and an increase in electricity tariffs for certain households.

A Reuters survey of several economists produced an average projection for February inflation at 4.81 percent. That rate would still be within Bank Indonesia’s target of 3.5 percent to 5.5 percent this year.

The survey also predicted core inflation, which excludes items subject to price volatility, at 4.35 percent, slightly changed from the previous month’s 4.32 percent.

JakartaGlobe

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