Inflation to creep up to 5.2% in Indonesia

Blame it on food price hikes starting in mid-Q3 due to Ramadan.

According to Nomura's Asia Special Report, unlike regional peers, CPI inflation in Indonesia is already creeping up. In our baseline forecast, we expect further increases in headline inflation, driven by food price increases starting in mid-Q3 due to Ramadan, current account deficits pressuring IDR and core inflation remaining elevated.

Here's more from Nomura:

We forecast CPI to end-2012 at 5.2% versus Bank Indonesia‟s (BI) target of 3.5-5.5%.

Under scenario 1, we expect CPI inflation to accelerate to 5.9% in Q4, and exceeding BI‟s target. In early 2013, the global commodity price increases will likely force the government to implement the fuel subsidy cuts that were thwarted earlier this year to contain the impact on the fiscal balance. This should lead to a jump in inflation.

By contrast, under scenario 2, we expect CPI inflation to decline precipitously starting in Q4 2012 as domestic demand sharply weakens and food inflation retreats with global trends.

Also Read

Singapore ranks second in global economic freedom

Economists forecast modest NODX growth for Singapore in 2024

Since you're here...

...there are many ways you can work with us to advertise your company and connect to your customers. Our team can help you dight and create an advertising campaign, in print and digital, on this website and in print magazine.

We can also organize a real life or digital event for you and find thought leader speakers as well as industry leaders, who could be your potential partners, to join the event. We also run some awards programmes which give you an opportunity to be recognized for your achievements during the year and you can join this as a participant or a sponsor.

Let us help you drive your business forward with a good partnership!

I want to download the media kit