Indonesia: Inflation continues to moderate in October on the back of lower food prices
November 1, 2011
In October, consumer prices decreased 0.12% over the previous month, which contrasted the 0.27% rise recorded in September. Food prices, which have the biggest weight in the consumer price index, fell 0.35%. Clothing prices decreased 1.26% over the previous month. As a result, annual inflation decelerated from 4.6% in September to 4.4% in October, which was below market expectations of 4.8%. Annual average inflation eased from 5.9% in September to 5.8% in October. Inflation has been moderating since January, with the exception of a seasonal spike in August, giving Bank Indonesia leeway for adopting a more accommodating monetary policy. The Central Bank has an inflation target of 5.0% 1% for this year and 4.5% 1% for 2012.