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Core Inflation At Bottom Of Band, Real Rates Rise

INDONESIA

Indonesian CPI inflation for September was slightly stronger than expected at 2.3% down from 3.3% in August helped by base effects as last year’s subsidised fuel price increase dropped out of the annual comparison. Core eased further to 2% from 2.2%, and is now at the bottom of Bank Indonesia’s target band. Despite low inflation the central bank left rates unchanged in September at 5.75% to stabilise the rupiah. Real rates are not only positive but increased further in September.

  • Food, beverage & tobacco and transport prices rose on the month in September. With rice prices rising strongly, volatile food inflation rose to 3.6% y/y in September from 0% in July.
  • Administered prices eased to 2% y/y from 8% in August.
Indonesia CPI y/y%

Source: MNI - Market News/Refinitiv

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