Low inflation maintained in March: BI

Low inflation maintained in March: BI

Bank Indonesia logo . (ANTARA News)

Jakarta (ANTARA) - March 2019 saw low and controlled inflation. The Consumer Price Index (CPI) recorded a 0.11 percent (mtm) inflation in the reporting period to upend the 0.08 percent (mtm) deflation reported the previous month.

The main driver of inflationary pressures in March 2019 was administered prices (AP), contrasting flatter core inflation and deflation of volatile foods (VF), Executive Director of BI Communication Department Onny Widjanarko said in a statement here on Friday.

On an annual basis, therefore, CPI inflation stood at 2.48 percent (yoy) in the reporting period, down from 2.57 percent (yoy) the previous month.

Bank Indonesia will continue to consistently sustain price stability and strengthen policy coordination with the Central Government and Regional Administrations to ensure low and stable inflation in pursuance of the target corridor for 2019, namely 3.5 percent+1 percent.

Inflationary pressures on administered prices (AP) edged upwards in the reporting period as a result of rising airfares.

AP inflation was recorded at 0.08 percent (mtm) in March 2019, up slightly from 0.06 percent (mtm) the previous month. Airfares were the main contributor to higher AP inflation, contrasting the deflationary pressures on fuels and electricity rates.

Annually, therefore, administered prices recorded a 3.25 percent (yoy) inflation in the reporting period, falling from 3.38 percent (yoy) in the previous period.

Core inflation slowed from 0.26 percent (mtm) in February 2019 to 0.06 percent (mtm) in March 2019.

House rentals, gold jewellery and homeworkers' wages were the key drivers of core inflation in the reporting period.

Annually, core inflation stood at 3.03 percent (yoy), down slightly from 3.06 percent (yoy) the previous month. Policy consistency by Bank Indonesia to anchor rational inflation expectations, including measures to maintain the rupiah in line with the currency's fundamental value, controlled core inflation.

Volatile foods (VF) experienced deflationary pressures in March 2019 in line with seasonal trends.

Volatile foods recorded 0.02 percent (mtm) deflation in the reporting period, reversing the 1.30 percent (mtm) inflation posted the previous month.

VF deflation stemmed from price corrections affecting purebred chicken meat, rice, fresh fish, purebred chicken eggs, tomatoes and carrots.

In contrast, the prices of shallots, garlic, papaya and red chillies continued to rise. Annually, VF inflation stood at 0.16 percent (yoy), down from 0.33 percent (yoy) the previous month.

   

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