JAKARTA- Indonesia’s annual inflation rate eased to 2.51 percent in June, its lowest level in nine months, to sit near the middle of the central bank’s 1.5 percent to 3.5 percent target range, official data showed on Monday.
A Reuters poll had expected June’s headline inflation to be 2.70 percent , compared with 2.84 percent in May.
Core inflation, which strips out government-controlled prices and volatile food prices, was at 1.90 percent in June, compared to 1.93 percent in May. Analysts had expected a reading of 1.94 percent.
Prices of food products contributed to June’s inflation, while prices of financial services saw some deflationary pressure, Statistics Indonesia official Imam Machdi told reporters, adding that the inflation rate of volatile components eased.
Inflation has stayed within Bank Indonesia’s (BI) target since the middle of last year, but the central bank is monitoring for signs of imported inflation given the weakness of the rupiah against the US dollar
BI kept its policy rate unchanged in June, but said it would fine-tune other tools to defend the rupiah. Governor Perry Warjiyo said last week he saw no need for further rate hikes at the moment.
