Indonesia sees highest deflation since 2000

Indonesia recorded monthly deflation of 0.45 percent in April, an impact of a cut in fuel prices and concurrent reduction in public transportation fares at the beginning of the month, according to the Central Statistics Agency ( BPS ).

The figure is the highest deflation rate since 2000 and brings the year-to-date inflation rate to 0.16 percent and the annual rate to 3.36 percent year-on-year.

“The transportation, communication and financial sectors recorded the most significant deflation as a result of the cut in fuel prices in April,” BPS head Suryamin said in a press conference on Monday. In addition, staple foods also recorded deflation of 0.94 on the downward trend of prices of several commodities, such as rice, meat, fish and eggs. Water, electricity and gas scored 0.13 percent deflation, while food, drinks and cigarettes recorded slight inflation of 0.35 percent. “This shows that the development of staple commodity prices remains under control,” Suryamin noted.

The April deflation is in line with Bank Indonesia’s estimation, the central bank previously predicting slight deflation of 0.33 percent following the roughly 4 percent decline in public transportation fares and Rp 500 ( 4 US cents ) per liter decline in fuel prices.

The price of subsidized Premium gasoline was cut by Rp 500 from Rp 6,950 per liter to Rp 6,450 since April 1, while the price of subsidized diesel was cut by Rp 500 from Rp 5,650 to Rp 5,150 per liter. ( ags ) (