Indonesia Inflation January 2016


Indonesia: Inflation rises from six-year low in January

February 4, 2016

Consumer prices increased 0.51% in January over the previous month, which was much weaker than the 0.96% rise tallied in December. January’s reading came on the back of large increases in prices for foodstuffs, while prices for transportation, communication and financial services decreased notably.

Inflation picked up from December’s 3.4%, which had marked the lowest reading in six years, to 4.1% in January. The reading was slightly above market expectations of 3.8%. Annual average inflation fell from 6.4% to 6.1%. Meanwhile, the core consumer prices, which excludes volatile items such as food and administered prices, increased 0.29% over the previous month (December: +0.23% month-on-month). Core inflation decreased from 4.0% in December to 3.6% in January, which marked the lowest figure in over five years.

The Central Bank’s inflation target for 2016 is 3.0%–5.0%. FocusEconomics Consensus Forecast panelists expect that inflation will average 4.7% in 2016, which is down 0.1 percentage points from last month’s forecast. For 2017, panelists see inflation averaging 4.9%.

Author: Angela Bouzanis, Senior Economist

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Indonesia Inflation Chart

Indonesia Inflation January 2016

Note: Annual and monthly variation of consumer price index in %.
Source: Statistics Indonesia (BPS) and FocusEconomics calculations.

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