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Inflation in February manageable despite rising prices: BI
Bank Indonesia (BI) expects the impacts of electricity rate increases and rising food prices last month will continue in February as reflected through its latest inflation survey.
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Bank Indonesia Governor Agus Martowardojo speaks to journalists on the sidelines of an event in Surabaya. (JP/Anton Hermansyah)
Bank Indonesia (BI) expects the impacts of electricity rate increases and rising food prices last month will continue in February as reflected through its latest inflation survey.
With the impact of the increased rate for 900 volt-ampere (VA) capacity, the central bank recorded in its survey that inflation in the second week of February stood at 0.35 percent, lower than the same period last month when the figure reached 0.69 percent.
“The effects of the increase in the electricity rate remains to be seen in February, while we also saw rising prices in some volatile food commodities, such as chili,” said BI Governor Agus Martowardojo on Friday.
(Read also: Jakarta inflation reached 0.99 percent in January: Central bank)
He said the central bank was continuously strengthening coordination with the government to ensure that inflation by the end of the year stayed within the forecast range of 3 to 5 percent, with the exact percentage at 4 percent.
While trying to manage domestic inflation, Agus said, the central bank also monitored global geopolitical and economic developments, such as the upcoming presidential election in France and fears of the country leaving the European Union (EU), also known as “Frexit”.
There is also tight monitoring on the upcoming plan of United States President Donald Trump to carry out big tax cuts in the next one or two weeks, which would affect global financial markets.
However, BI remained confident that the domestic economy would remain strong and stable, with investor trust remaining high. Capital inflow reached Rp 24.4 trillion (US$1.83 billion) year-to-date. (bbn)
