Macroeconomic Forecast Indonesia

Indonesia's disinflationary trend took a breather in August, with headline CPI registering an increase to 4.79% year-on-year from 4.6% a month earlier. Nevertheless, the slightly above-consensus figure is unlikely to change the rate outlook for Indonesia, as the Bank of Indonesia is more likely to call for a higher bank reserve ratio as a tool to mop up excess liquidity in the system. Despite the slight increase, we continue to forecast a downward trend for Indonesia's inflation metric through H211, with the end of period figure coming in at 4.5%.

To read the full article, please choose one of the following options: