Deflation Knocks on Indonesia’s Door

Originally published by Jakarta Post on September 3, 2018 Read the original article.

Robert Prechter’s Conquer the Crash warned that the trend toward deflation is “a global story.”

And, it’s turning out to be just that.

Consider Indonesia. Most people have heard of the nation, but many may not know that it’s the world’s fourth most populous. Only China, India and the United States have larger populations.

Having said that, the Southeastern Asian nation is now confronting deflation. This is a change.

Details are provided in this Sept. 3 Jakarta Post article:

Indonesia recorded deflation of 0.05 percent in August on the back of decreasing foodstuff prices, while the start of the school year resulted in inflation in the education spending category, Statistics Indonesia (BPS) announced on Monday.

August’s deflation is in contrast to the 0.28 percent inflation recorded in the previous month. The latest figure brought year-to-date (ytd) inflation to 2.13 percent, while year-on-year (yoy) inflation in August was recorded at 3.2 percent.

The deflation in August corresponded with 0.07 percent deflation and 0.02 percent deflation in the same period in 2017 and 2016, respectively.

The government has targeted inflation to hover between 2.5 and 4.5 percent this year.

“August’s deflation was affected by price decreases in chicken eggs and shallots, as well as airline rates,” said BPS head Suhariyanto in Jakarta on [Sept. 3].

Price decreases in airline rates contributed to 0.15 percent deflation in transportation, communications and financial services in August.

In the same month, there were price increases in the education sector and inflation of 1.03 percent in the education, recreation and sports categories.

Inflation was recorded in school fees at elementary schools and high schools.

Core inflation stood at 0.3 percent last month, while administered prices deflated by 0.06 percent and volatile prices by 1.24 percent.

Prepare for what Elliott Wave International sees just around the corner with the free report, “What You Need to Know NOW About Protecting Yourself from Deflation.”

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