BI Board of Governor's Meeting, January 2018

Febrio Kacaribu (), Alvin Ulido Lumbanraja () and Denny Irawan ()
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Febrio Kacaribu: Institute for Economic and Social Research, Faculty of Economics and Business, Universitas Indonesia (LPEM FEB UI)
Alvin Ulido Lumbanraja: Institute for Economic and Social Research, Faculty of Economics and Business, Universitas Indonesia (LPEM FEB UI)
Denny Irawan: Institute for Economic and Social Research, Faculty of Economics and Business, Universitas Indonesia (LPEM FEB UI)

No 201801, LPEM FEBUI BI Board of Governor Meeting Brief from LPEM, Faculty of Economics and Business, University of Indonesia

Abstract: December inflation figure gave mixed signal about the exact economic condition, but overall FY 2017 result suggests that a relatively stable inflation has become the norm. Barring any move to cut implicit fuel subsidy, we see 2018 inflation to remain within BI’s goal of 3.5±1%. While stable inflation and improving global growth will slightly improve 2018 growth, we still view government’s growth target, as set by Ministry of Finance, to be still overly optimistic. Improvement of growth prospect also still leaves room for more accommodative policy stance, given still-low core inflation. From external side, concern about shocks to Rupiah should also be largely reduced by now, given milder-than-expected market reaction to December rate hike by Federal Reserves. For now, however, Bank Indonesia may want to maintain wait-and-see attitude and hold its policy rate.

Keywords: gdp; —; economic; —; economic; outlook; —; inflation; —; macroeconomics; —; interest; rate (search for similar items in EconPapers)
Date: 2018-01, Revised 2018-01
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