Jakarta: Bank Indonesia (BI) will continue to consistently maintain price stability and strengthen policy coordination with the central and local officials to ensure low and stable inflation in 2020.
"Consumer Price Index (CPI) inflation remained low and under control in January 2020," the central bank said in a press release issued on Monday, February 3, 2020.
CPI inflation was recorded at 0.39 percent (mtm) in January 2020, influenced by controlled core inflation and deflation of administered prices despite a modest build-up of inflationary pressures on volatile foods. Consequently, annual CPI inflation stood at 2.68 percent (yoy) in the reporting period, down from 2.72 percent (yoy) in December 2019.
Rising prices of gold jewellery mirroring higher international gold prices, coupled with increasing house rental prices, non-supervisory wages and motor vehicles following seasonal trends at the beginning of the year have edged up core inflation to 0.19 percent (mtm). Annually, core inflation stood at 2.88 percent (yoy) in the reporting period, down from 3.02 percent (yoy) one month earlier.
Administered prices posted 0.28 pecent (mtm) deflation in the reporting period, hence reversing the 0.63 percent (mtm) inflation recorded one month earlier. Deflationary pressures primarily stemmed from government policy to reduce prices of special fuels and normalise airfares after the yearend festive period. Annually, administered prices recorded 0.64 percent (yoy) inflation, up from 0.51 percent (yoy) the month earlier.
Rising prices of various food commodities have triggered inflationary pressures on volatile foods. Volatile foods (VF) recorded 1.93 percent (mtm) inflation in January 2020, increasing from 0.86 percent (mtm) in the previous period. Amongst others, the recent uptick was attributable to the devastating flooding experienced in various regions, which hampered the production and distribution of several volatile foods. Annually, VF inflation stood at 4.13 percent (yoy), down from 4.30 percent (yoy) one month earlier.