Highlights BI needs to hold benchmark rate at 5% for now Inflation by end of the year to be within BI’s target range but close to the lower bound Concern on Fed rate hike to counteract case for BI rate cut from soft inflation rate Reverse Repo Rate fall short of its promise in its first 6 months.
In September 2016, (general) inflation is 0.22% (mtm) or 3.07% (yoy). This low inflation in September is consistent with LPEM FEB-UI’s previous forecast. This low inflation comes from overall mild inflation of all expenditure groups except for food expenditure that has deflation. By analyzing inflation source from six main commodities, three of them are having […]
Institute for Economic and Social Research, Faculty of Economics and Business, University of Indonesia (LPEM FEBUI) together with Millennium Challenge Account Indonesia (MCAI) are committed to promote implementation effectiveness of green budgeting — as one of the main drivers for Indonesia to reduce emissions of green house effect (GRK).
Last month, BI adopted the new set of policy rates that consist of BI 7-Day RR accompanied by new corridor of Lending Facility and Deposit Facility, each 75 bps above and below BI 7-day RR. We applaud this move. It will make BI’s direction of policy to be easier to understand by the market. Additionally, […]
In August 2016, (general) deflation is 0,02% (mtm) or 2,79% (yoy). Compare to previous years, deflation in August 2016 is the first deflation after 8 years. This economic phenomena happen due to change of fasting/ramadan month. Eight years ago, deflation happened right before fasting month started. In this August food and transportation price are finally normalized […]
We maintain our longstanding view that Bank Indonesia should cut the benchmark rate by 25 bps on Friday meeting, despite BI’s decision to postpone rate decrease for the last two meetings.
Central Bureau of Statistics (BPS) records (general) inflation of 0,69% (mtm) or 3,21% (yoy) in July 2016. BPS data shows that July 2016 inflation is the lowest during this last five years. All expenditure groups shows general price increase. Highest price increases occur in food, transport & communication and financial services expenditure groups. These incidences […]