Indonesia's inflation rate dropped in October to its lowest since April, as prices for housing, utilities, foodstuffs, transportation, clothing, and communication and financial services increased at a slower pace. (Antara Photo/Weli Ayu Rejeki)
Indonesia's Inflation Rate Drops to Lowest Level in 7 Months in October
NOVEMBER 01, 2019
Jakarta. Indonesia's inflation rate dropped in October to its lowest since April, as prices for housing, utilities, foodstuffs, transportation, clothing, and communication and financial services increased at a slower pace.
Annual inflation stood at 3.13 percent in October, compared with 3.39 percent in the preceding month and below market expectations of 3.52 percent, Central Statistics Agency (BPS) data shows. Core inflation, which does not account for volatile food prices and administered prices, also slowed to 3.2 percent last month from 3.3 percent in September.
"The prices of some commodities, such as red chilies, eggs, bird's eye chilies, fresh fish, green chilies, potatoes and garlic, declined," BPS head Suhariyanto said on Friday.
He also noted that airfares, which had been on the rise over the past nine months, had also declined.
"Inflation is still under control. I believe the inflation target will be achieved in the remaining two months [of this year]," Suhariyanto said, referring to the government and Bank Indonesia's inflation target of 3.5 percent.
Stable inflation has anchored Bank Indonesia easing over the past four months, allowing the bank to cut its benchmark interest rate four consecutive times to prop up economic growth.
The central bank's benchmark interest rate currently stands at 5 percent – its lowest since June last year. Bank Indonesia Governor Perry Warjiyo earlier said the bank was committed to direct all instruments at its disposal to promote growth in the Indonesian economy.
The government targets a 5 percent expansion in Indonesia's gross domestic product this year and 5.3 percent next year.