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Indonesia: BI Projects May Inflation at 0.27%

TEMPO.CO, Jakarta – Bank Indonesia (BI) projects May’s inflation at 0.27 percent. This is based on a survey BI held in 82 cities in the second week of the month.

On an annual basis, May’s inflation is estimated at 4.12 percent. “This is still in line with the government’s and BI’s target,” BI governor Agus Martowardojo said last week.

Despite an inflation rate that is still within the government’s target, there are pressures to keep an eye on, Agus said. These include food price hikes and the electricity subsidy cancellation for the 900-VA household subscribers group.

The potential for price hikes increases nearing the fasting month of Ramadan.

“There will be an effect of increasing prices of electricity, food, transportation and clothing,” BPS chief Suhariyanto said.

Suhariyanto said the government must mitigate volatile food prices at around 4.0 percent to maintain inflation from going up. This can be done by improving distribution and market supervision.

Source: https://en.tempo.co/read/news/2017/05/15/056875315/BI-Projects-May-Inflation-at-027