JAKARTA (TheInsiderStories) – Indonesia’s Statistics Bureau reported in September 2017 there was inflation of 0.13 percent with the Consumer Price Index (CPI) of 130.08. In August, the CPI recorded of 3.83 percent deflation.
The inflation rate for calendar year (January-September) 2017 is 2.66 percent and the year-on-year inflation rate (September 2017 to September 2016) is 3.72 percent.
Discretionary food component, cigarettes, tobacco saw their price rising 0.34 percent. While housing, electricity, fuel and gas component rose 0.21 percent. Clothing component rose 0.52 percent, Health component rose 0.16 percent, education, recreation and sport component rose 1.03 percent, transportation, communication and financial component rose 0.02 percent. In other hand, staple food decreased 0.53 percent.
An analysis from central bank previously said that there will be another deflation in the consumer price index for September 2017, just like in the previous month.
“In general, there is a pressure for deflation, and the potential for a deflation in September is 0.01 percent,” Bank Indonesia’s (BI) Governor Agus Martowardojo said recently.
This projection contradicted with the forecast of BI stated last week. At the time, the central bank predicted a monthly inflation of 0.02 percent.
If there is indeed a deflation in September, then the yearly inflation for the third quarter would be around 3.5 percent to 3.6 percent. This brings the rate closer to the lower limit of BI’s target for this year’s inflation, which is between three and five percent.
Agus said that the potential for deflation in September is supported by the steady decline in food prices that came after the increase in consumption in July along with the Ramadan and Eid season
BI last month lowered its benchmark policy rate two time in a row, bringing the rate down by 25 basis points to 4.25 percent. The last monetary rate cut done by central bank is October last year. The move was accompanied by its plans to tweak credit rules in a bid to help stimulate commercial lenders’ loans and spur consumption.
Looking a head, Statistics Bureau underlining inflation trend in the fourth quarter of this year, particularly in December when there is rising trend of Chrismast and New Year period. If government can manage inflation during the period, inflation target range of 4 percent will be achieved.
Meanwhile, Economist from INDEF Bhima Yudisthira see Oct-Dec as peak period of national consumer price index regarding the Chrismast and New Year period where people expend more during the period. In other hand, administration price including BBM, electricity tariff, 3 kilograms gas tend to remain flat and will give mix effect on peak inflation period.
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