Information, communication and financial service costs were down slightly in January while transportation costs hardly changed. (Antara Photo/Fikri Yusuf)

Inflation Slows to Nine-Month Low in January


FEBRUARY 03, 2020

Jakarta. Inflation in Indonesia slowed again in January to a nine-month low on the back of stabilizing transportation costs and a slight decline in the prices of telecommunication and financial services, the Central Statistics Agency, or BPS, said on Monday.  

BPS data showed consumer price index (CPI) was up by 2.68 percent last month compared to the same month last year. That was slower than December's 2.72 percent inflation, BPS said.

Information, communication and financial service costs were down slightly by 0.11 percent, while transportation costs hardly changed from a year ago. 

Core inflation, which excludes volatile raw food prices and administered prices for subsidized fuel and electricity, also decelerated to 2.88 percent in January from 3.02 percent in December. 

Bank Indonesia, the country's central bank, has projected that inflation would hover around 3 percent this year, after plunging to a two-decade low of 2.72 percent last year.

The central bank has taken advantage of the low inflation by cutting its benchmark interest rate four times last year before taking a break and keeping it at 5 percent for the last three months. 

Economists say Bank Indonesia's monetary policy will remain accommodative this year to boost economic growth. Some even expect further interest rate cuts later this year.