Indonesia’s CPI inflation remains stable in August 2019

Indonesia’s inflation ticked up marginally to 3.49 percent in August 2019 compared to 3.32 percent in July, reached the midpoint of central bank of Indonesia’s target range of 3.5 percent plus or minus 1 percent. The acceleration in the inflation was largely due to rise in clothing, education and recreation and sports, but dampened somewhat by lower food and transport prices.

Core inflation, which excludes volatile items price such as food and energy, marginally moved up 3.3 percent in August from 3.2 percent from previous month. The acceleration in the inflation was driven by increase in gold prices.

Given the subdued inflationary pressure and slowing economic growth, central bank of Indonesia could take accommodative stance and allow for further rate cuts going forward.