- Indonesia's inflation rate continued its deflationary trend in August, reaching 2.12% YoY (-0.03% MoM), driven by deflation in foodstuffs like shallots and chicken, while administered prices rose due to non-subsidized fuel prices.
- Core inflation increased (0.20% MoM), mainly due to personal care and education costs, which, if excluded, would result in much lower overall inflation, around 1.7% YoY.
- Low domestic and global demand, especially from China and the US, have further kept inflation down, impacting Indonesia's imported prices.
- Monetary easing is expected, but BI may delay the rate cut to Q4, while cautiously managing SRBI to avoid Rupiah depreciation.
