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Indonesia: Indonesia’s Purchasing Power Weaker? See Cash Outflow & Inflation
Indonesia: Indonesia’s Purchasing Power Weaker? See Cash Outflow & Inflation
Mon, 04 July 2016 – Whereas Indonesia’s inflation pace usually accelerates markedly ahead of the Idul Fitri due to rising consumer spending, the relatively moderate inflation in June (0.66 percent m/m) can be taken as a sign that Indonesia’s purchasing power is still rather weak. Another sign that indicates weak purchasing power is that the amount of cash in circulation in Indonesia during the Ramadan and Idul Fitri celebrations fell short of the central bank’s initial estimates. Consumption of unsubsidized fuels, however, has nearly doubled.
The central bank of Indonesia (Bank Indonesia) stated that the total cash outflow from the lender of last resort amounted to IDR 140 trillion (approx. USD $10.6 billion) between the start of the holy Islamic fasting month (Ramadan) in early June 2016 and the end of last week. However, Bank Indonesia had prepared IDR 160 trillion (approx. USD $12.1 billion) in cash money for the holiday period. Read More?