Indonesia’s December headline inflation rate seen at 3.40 percent year-on-year: Reuters poll

Women walk at a mall in Jakarta
Women walk at a mall in Jakarta, Indonesia, December 21, 2017. REUTERS/Beawiharta

December 28, 2017

JAKARTA (Reuters) – Indonesia’s headline inflation rate is expected to have risen slightly in December, the first rise after five months of falls but stayed within the central bank’s target range, a Reuters poll showed.

The consumer price index (CPI) rose 3.40 percent in December from a year earlier, compared with 3.30 percent in November, according to the median forecast of 11 economists polled by Reuters.

On a monthly basis, the inflation rate was seen at 0.48 percent, picking up pace from 0.20 percent in November.

Some economists cited rising demand for goods and services during Christmas celebration and ahead of New Year holidays as the main factor for December’s inflationary pressure.

Bank Indonesia (BI) has forecast a headline inflation rate of 3.0 percent to 3.5 percent by the end of the year and 2.5 percent to 4.5 percent in 2018.

The annual core inflation rate, which strips out government-controlled and volatile food prices, was seen increasing marginally to 3.08 percent, according to the median forecast of seven analysts who have a view on December core inflation. The rate for November was 3.05 percent.

(Polling by Nilufar Rizki; Editing by Subhranshu Sahu)