Wednesday, 19 January 2022 | 18:21 WIB

Like Previous Month, BI Sees another Deflation in September 2017

Office of Bank Indonesia

JAKARTA, NETRALNEWS.COM - September 2017 is expected to have deflation as what happened in August.

Last month's deflation occurred in the consumer price in August 2017, due to the decline in some food prices such as chicken meat, eggs, and several variants or onion.

"In general there is a deflationary pressure so the potential for September deflation is 0.01 percent," said Governor of Bank Indonesia (BI) Agus Martowardojo in Jakarta, Friday (9/29/2017).

The deflationary forecast was proportionally reversed compared to the third week of September 2017 when BI still saw an inflation of 0.02 percent, month-to-month.

Agus said deflation in the ninth month is due to continued decline in food prices after the high consumption trend in Ramadan and Lebaran (Eid al-Fitr), July 2017.

However, there are some components of goods recorded to have inflation, such as, the cost of education, land and housing rental.

If BI's estimate is realized in September, year-on-year inflation in the ninth month will be around 3.5-3.6 percent or likely to continue moving to the lower limit of the Central Bank inflation target at three to five percent.

Asked about the indicators of the deflation trend that tend to indicate weak consumption, Agus dismisses it. He said the public consumption rate until September 2017 showed an improvement over the previous months.

"This September we see there are quite a lot of improvements in terms of consumption, investment, or exports that show better conditions and we see in general our macroeconomy is well preserved," said Agus.