Inflation in 2019 within BI Inflation Target - Bank Sentral Republik Indonesia
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February 20, 2020

No. 22/1/DKom
Consumer Price Index (CPI) inflation in 2019 stood at 2.72% (yoy), which is within the BI target corridor for the last five consecutive years, the figure of which in 2019 is 3.5%±1%. The positive achievement is closely related to the consistency of Bank Indonesia in maintaining price stability with the support of strong synergy between the policies of Bank Indonesia and the Government in the central and regional levels. Going forward, Bank Indonesia remains committed to maintain price stability in order to keep inflation within the range of 3.0±1% in 2020.

The achievement is affected among others by the controlled CPI inflation in December 2019. Despite its increase compared to the inflation in November 2019 of 0.14% (mtm), the inflation in December 2019 of 0.34% (mtm) stood lower than the average year-end CPI inflation for the last four years standing at approximately 0.68% (mtm). Such improvement is supported by stable core inflation at 0.11% (mtm). Meanwhile, volatile food inflation remains controlled in spite of the increasing year-end seasonal pattern compared to the previous month from 0.42% (mtm) to 0.86% (mtm). Inflation of administered prices stood low in spite of the increasing year-end seasonal pattern compared to the previous month from 0.03% (mtm) to 0.63% (mtm).

With such development, CPI inflation in 2019 records a decrease compared to that in 2018 standing at 3.13% (yoy). Such condition is influenced by the consistently low core inflation of 3.02% (yoy), the consistent policies of Bank Indonesia in maintaining price stability making the expected inflation on target, the properly managed aggregate demands, the exchange rate movement according to its fundamentals, and the positive contribution of minimum global price increase. Inflation of volatile food is also controlled at 4.30% (yoy), supported by synergy between the policies of Bank Indonesia and the Government resulting in maintained food supply amidst the bad weather in the middle of 2019. Meanwhile, inflation of administered prices stood low at 0.51% (yoy), in line with the least policy on tariffs and prices of goods and services managed by the Government.

Jakarta, 2 January 2020
COMMUNICATION DEPARTMENT

Muhamad Nur
Director

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