Indonesia inflation expectations coming down near central bank’s forecast – gov

1 min read
FILE PHOTO: G20 finance ministers, central bankers and senior officials meet in Bali

(Reuters) – Indonesia’s central bank governor Perry Warjiyo said on Friday inflation expectations were coming down rapidly after Bank Indonesia (BI) started hiking interest rates aggressively four months ago.

He told a central banking forum in Bangkok that the consensus forecast for Indonesia’s inflation was at 6.9% four months ago, but now is approaching 5.5%, BI’s own forecast.

“After we aggressively responded through interest rates, the gap between consensus forecast and our forecast is narrowing,” he said, reiterating the need for “front-loaded, pre-emptive and forward-looking” interest rate policy.

BI has hiked the benchmark interest rate by 175 basis points in the past four months.


Related News:   Explainer-Spilt milk? Why are the U.S. and Canada fighting over dairy?

Warjiyo reiterated BI’s goal to lower core inflation back to its target range of 2%-4% in the first half of 2023 and lower the headline inflation to within target by the second half next year.

Indonesia’s annual headline inflation in November eased to 5.42% from 5.71% in October.

(Reporting by Fransiska Nangoy, Stefanno Sulaiman; Editing by Ed Davies, Kanupriya Kapoor)

tagreuters.com2022binary_LYNXMPEIB106E-BASEIMAGE