Indonesia's annual inflation rate stood at 2.12 per cent in August, barely changing from July's 2.13 per cent, according to official data released on Monday. This rate remains comfortably within the central bank's target range and aligns with market expectations.

The August headline inflation rate is the lowest recorded since February 2022 and matches the forecast from a Reuters poll. Bank Indonesia (BI) has set a target range for inflation between 1.5 per cent and 3.5 per cent.

Meanwhile, the annual core inflation rate inched up to 2.02 per cent in August, compared to 1.95 per cent in the previous month, slightly exceeding the poll's forecast of 1.98 per cent.

Inflation in Southeast Asia's largest economy has stayed within the central bank's target range since mid-last year. However, BI has maintained relatively high-interest rates, focusing on stabilising the rupiah and navigating global market volatility. Governor Perry Warjiyo has indicated that currency stability is the current policy focus, but he also noted that there could be room for monetary policy easing to stimulate economic growth in the coming quarter.

Source: Reuters