Indonesia Inflation May Plunge to 1.5%-3.5% in 2024: Central Bank

JAKARTA, KOMPAS.com - Indonesia's central bank (Bank Indonesia) estimated that inflation was likely to fall between 1.5 percent to 3.5 percent in 2024 after possibly reaching two to four percent in 2023.

As of November this year, inflation was recorded at 5.42 percent compared to the same period last year or on a year-on-year (yoy) basis.

"This estimate is supported by close synergy between the government and the central bank," Bank Indonesia (BI) Governor Perry Warjiyo said at the 2023 Jakarta Economic Outlook National Seminar on Wednesday, Dec. 14.

Also read: Indonesia Central Bank to Reduce Inflation to 3.61% in 2023

Warjiyo said that the synergy to reduce inflation was driven by energy subsidies by the government; a measurable increase in BI interest rates; measures to stabilize the rupiah by BI; and the close coordination of Central and Regional Inflation Control Teams (TPIP and TPID). This also includes the National Movement for Food Inflation Control (GNPIP).

According to him, synergy, coordination, and cooperation are the key for Indonesia to avoid the crisis, especially during the Covid-19 pandemic. This will also support the continuation of the national economic recovery process.

Through synergy, the BI governor is optimistic that the domestic economic recovery process will continue to improve amid the global turmoil.

BI estimates that Indonesia's economic growth in 2023 will be good, at around 4.5 percent to 5.3 percent, as compared to the previous year and will increase higher to 4.7 percent to 5.5 percent in 2024 as compared to 2023.

"Apart from exports, increased consumption and investment will also support national economic recovery, in addition to being supported by downstream programs, infrastructure development, influx of foreign investment, and tourism development," he said.

Source: State News Antara