Indonesia inflation hits new 7-year high after fuel price hike

JAKARTA, Oct 3 (Reuters) – Indonesia’s inflation rate in September accelerated to its highest since October 2015 due to higher transportation costs following a fuel price hike, statistics bureau data showed on Monday.

The headline annual inflation rate rose to 5.95% in September, up from 4.69% in August, but came in slightly lower than a 6.00% rate expected in a Reuters poll.

The annual core inflation rate, which excludes government-controlled prices and volatile food prices, picked up pace in September to 3.21%, compared with 3.04% in August and 3.60% forecast by analysts.

“September’s inflation was mostly affected by the rise in fuel prices and inflation in transportation sector,” Margo Yuwono, head of Statistics Indonesia told reporters.

He warned that inflation could heat up further in October as a number of regions have not yet increased their transportation fares.

Indonesia raised subsidised fuel prices by about 30% in early September as the government moved to rein in ballooning subsidy bills. read more