Indonesia posts an inflation 0.26 percent in January 2021 compared to last year at 0.19 percent - Photo by TheInsiderStories

JAKARTA (TheInsiderStories) – Indonesia posts an inflation 0.26 percent in January 2021 compared to last year at 0.19 percent, said head of statistic bureau today (02/01). In annual basis the inflation stood at 1.55 percent in January from a year ago at 2.88 percent

“All groups experienced inflation except transportation posted a deflation of 0.30 percent,” said Suhariyanto virtually today.

Last week, Bank Indonesia reported, based on the Price Monitoring Survey in the fourth week of January 2021, the price development in January 2021 is estimated to have inflation of 0.34 percent on monthly basis (MoM). With these developments, the inflation forecast for January 2021 is estimated at 0.34 percent  on a calendar year, and on an annual basis at 1.64 percent.

The main contributors to inflation were cayenne pepper by 0.10 percent (MoM), tempeh and tofu at 0.03 percent (MoM) each, intercity transportation rates of 0.02 percent (MoM), water spinach, spinach, beef, meat. purebred chicken, long beans, red chilies, mackerel, gold jewelry, rice with side dishes and air transportation rates are 0.01 percent (MoM), respectively. While, commodities that contributed to deflation in the reporting period were eggs of broilers at -0.06 percent (MoM) and shallots at -0.02 percent (MoM).

To curb the inflation, the central bank has kept the Seven Days Repo Rate at 3.75 percent, Deposit Facility rate at 3.00 percent, and the Lending Facility interest rate at 4.50 percent, the governor announced today. Apart from the policy rate, the central bank also taking other further steps to curb the domestic economy from

According to the governor, Perry Warjiyo, the steps taken by BI to stabilize Rupiah inline with market fundamentals and mechanisms and to maintained the inflation in the target range. Then, strengthening the monetary operation strategy to support the accommodative monetary policy stance.

Furthermore, to accelerated the financial market deepening by strengthening the Jakarta Interbank Spot Dollar Rate as a reference for the local exchange rate against the US Dollar in order to increases the domestic foreign exchange market and support the stability.

In addition, strengthening macro-prudential policies to boost credit and financing to priority sectors in the context of national economic recovery. Moreover, encouraged the transparency in bank lending rates in order to accelerate the transmission of monetary and macro-prudential policies.

And, strengthen integrated banking supervision coordination between BI, the Financial Services Authority, and the Deposit Insurance Corporation in order to support financial system stability. At the end, strengthening the role of payment system policies and Rupiah currency management in encouraging the formation of a digital economic and financial ecosystem to accelerate economic recovery.

“This seventh policy is carried out through the implementation of a strategy to achieve 12 million QRIS merchants in an integrated and collaborative manner, as well as the development of transfer,” said Warjiyo.

He opted to pause and keep the rate for potential easing in 2021, retaining his accommodative stance given benign inflation and the negative GDP. So far, BI has cut the policy rates by 125 basis points.

Written by Editorial Staff, Email: theinsiderstories@gmail.com