BI Board of Governor's Meeting, December 2022

Jahen Rezki, Syahda Sabrina (), Nauli A. Desdiani (), Teuku Riefky, Amalia Cesarina, Meila Husna () and Faradina Alifia Maizar ()
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Syahda Sabrina: Institute for Economic and Social Research, Faculty of Economics and Business, Universitas Indonesia (LPEM FEB UI)
Nauli A. Desdiani: Institute for Economic and Social Research, Faculty of Economics and Business, Universitas Indonesia (LPEM FEB UI)
Meila Husna: Institute for Economic and Social Research, Faculty of Economics and Business, Universitas Indonesia (LPEM FEB UI)
Faradina Alifia Maizar: Institute for Economic and Social Research, Faculty of Economics and Business, Universitas Indonesia (LPEM FEB UI)

No 202212, LPEM FEBUI BI Board of Governor Meeting Brief from LPEM, Faculty of Economics and Business, University of Indonesia

Abstract: November inflation stood at 5.42% (y.o.y), continuing its deceleration pattern in the last three months. A combination of seasonal events as well as impact of inflation controlling efforts by the government and central bank has resulted in a sooner-than-expected inflation peak and more benign inflation rate towards the end of 2022. On the other hand, anticipated rate hike ease by major central banks has triggered surge of capital flows into emerging markets, including Indonesia. Since mid-November, net capital inflow to Indonesia has amounted to around USD2.12 billion, strengthening Rupiah to around IDR15,500 and driving down yields for both 10-year and 1-year Indonesian government bonds to 7.02% and 5.49%, respectively. Thus, we see that BI should ease its hawkish stance and hike policy rate by 25bps this month to 5.50%.

Keywords: gdp; —; economic; —; economic; outlook; —; inflation; —; macroeconomics; —; interest; rate (search for similar items in EconPapers)
Date: 2022-12, Revised 2022-12
New Economics Papers: this item is included in nep-des and nep-sea
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