TheJakartaPost
Please Update your browser
Your browser is out of date, and may not be compatible with our website. A list of the most popular web browsers can be found below.
Just click on the icons to get to the download page.
Inflation shows weak purchasing power to drag out economic recovery
The consumer price index (CPI) rose 0.07 percent in October driven by higher food and healthcare prices, higher than 0.02 percent recorded in the same month last year, Statistics Indonesia (BPS) announced on Monday.
Change text size
Gift Premium Articles
to Anyone
Share the best of The Jakarta Post with friends, family, or colleagues. As a subscriber, you can gift 3 to 5 articles each month that anyone can read—no subscription needed!
Residents shop at Pasar Inpres Manonda, a traditional market in Palu, Central Sulawesi, on May 26, 2020. (Antara/Mohamad Hamzah)
I
ndonesia’s inflation continues to reflect weakening purchasing power despite rebounding from three consecutive months of deflation, raising concerns over slower economic recovery.
The consumer price index (CPI) rose 0.07 percent in October driven by higher food and healthcare prices, higher than 0.02 percent recorded in the same month last year, Statistics Indonesia (BPS) announced on Monday. Meanwhile, the annual inflation rate quickened to 1.44 percent in October, far below Bank Indonesia’s target range of 2 to 4 percent.
The October inflation was driven by the rising prices of red chili, shallots, cooking oil, healthcare products, as well as rice and dishes in restaurants, among other products, BPS said.
The inflation last month was caused by higher food prices rather than improved demand as the country entered the rainy season, which curbed food production, Bank Mandiri economist Faisal Rachman wrote in a research note on Monday.
“The domestic demand remained weak as the pandemic hit hard on almost all aspects of the economy,” he stressed.
BPS data show that the core inflation, which excludes volatile food and government-controlled prices, dropped to 1.74 percent year-on-year (yoy) in October from 1.86 percent yoy recorded in September, signaling sluggish demand for goods. Administered prices were up 0.46 percent yoy, while volatile prices recorded annual inflation of 1.32 percent.
