arabtoday
Last Updated : GMT 18:23:36
Arab Today, arab today
Arab Today, arab today

Indonesia lifts rates to cap inflation after fuel hike

Arab Today, arab today

Arab Today, arab today Indonesia lifts rates to cap inflation after fuel hike

Jakarta - AFP

Indonesia\'s central bank on Thursday hiked its key interest rate for a second consecutive month as it seeks to keep inflation in check after a huge rise in the price of fuel. The decision by Bank Indonesia to lift rates by 50 basis points to 6.50 percent came as a surprise, with most economists expecting a 0.25 percentage point rise. It had announced a 25 point rise in June. The move will also provide much-needed support to the flagging rupiah, which has tumbled against the dollar as foreign investors retrench in expectations the US Federal Reserve will wind down its easy-money stimulus programme. The government raised the price of petrol by 44 percent and diesel by 22 percent last month, the first hike since 2008 as Southeast Asia\'s top economy seeks to reduce crippling subsidies. But the measure, which sparked violent protests across the country, pushed inflation to 5.90 percent on-year last month owing to the higher cost of transporting goods and public transport. The central bank said Thursday it now expected inflation to come in at an average of between 7.2 and 7.8 percent for the whole of 2013. But bank governor Agus Martowardojo sought to allay concerns, saying that \"Bank Indonesia estimates that the impact of the fuel price hike is temporary, about three months, and it will hit a peak in July\". The bank also increased the rate it pays lenders for overnight deposits by 50 basis points to 4.75 percent, a move aimed at reducing money supply, which should also slow the pace of inflation. The hike in June was aimed principally at shoring up the rupiah after the currency fell to multi-year lows owing to huge outflows of capital.Concern had been growing among international investors about the failure to cut the fuel subsidies, which are blamed for a widening current account deficit, as demand for fuel increases and the government is hit with ever bigger bills. Analysts said the moves to tighten monetary policy were necessary but came at a bad time as economic growth slows. Indonesia\'s economy expanded by 6.02 percent in the first quarter, the slowest pace in more than two years. And the central bank recently revised down its prediction for growth this year to a range of 5.8 to 6.2 percent, from an earlier estimate of 6.2 to 6.6 percent. \"The sharp fuel price rise and associated interest rate tightening measures, which may well not have finished yet, is coming at a time when the economy is softening,\" said economist Robert Prior-Wandesforde from Credit-Suisse. \"In our view, the market remains far too optimistic about Indonesia\'s economic outlook.\" The central bank also announced measures Thursday to cool the property market amid warnings it could be overheating, including stopping lenders from giving out loans for downpayments on purchases of houses and apartments. The new measures will be effective from September.

Name *

E-mail *

Comment Title*

Comment *

: Characters Left

Mandatory *

Terms of use

Publishing Terms: Not to offend the author, or to persons or sanctities or attacking religions or divine self. And stay away from sectarian and racial incitement and insults.

I agree with the Terms of Use

Security Code*

Arab Today, arab today indonesia lifts rates to cap inflation after fuel hike Arab Today, arab today indonesia lifts rates to cap inflation after fuel hike

 



Arab Today, arab today
Arab Today, arab today Adidas Originals ‘reinterpreted’

GMT 14:52 2016 Thursday ,01 December

Adidas Originals ‘reinterpreted’
Arab Today, arab today Holiday magic is everywhere

GMT 13:04 2016 Saturday ,03 December

Holiday magic is everywhere
Arab Today, arab today Paris's matchbox apartments

GMT 10:37 2016 Saturday ,24 September

Paris's matchbox apartments
Arab Today, arab today As nearly 20,000 children flee Aleppo

GMT 07:50 2016 Saturday ,03 December

As nearly 20,000 children flee Aleppo
Arab Today, arab today What next after landmark

GMT 09:01 2016 Saturday ,03 December

What next after landmark

GMT 11:34 2016 Sunday ,04 December

Wall Street rally ebbs as investors seek safety

GMT 22:58 2016 Saturday ,03 December

United States Stocks Close Little Changed

GMT 04:26 2016 Saturday ,03 December

Sterling posts best run vs. euro in 9 months

GMT 12:16 2016 Friday ,02 December

Dow ends at fresh record; Nasdaq tumbles 1.4%
View News in Arabic - Business: أسواق مالية
Arab Today, arab today
Arab Today, arab today
Arab Today, arab today Dino-killing crater shows clues

GMT 14:43 2016 Thursday ,24 November

Dino-killing crater shows clues
Arab Today, arab today For Yazidi women left behind

GMT 08:00 2016 Saturday ,03 December

For Yazidi women left behind
Arab Today, arab today Green groups pressure Spain

GMT 13:01 2016 Thursday ,01 December

Green groups pressure Spain
Arab Today, arab today Pluto's unruly moons

GMT 06:31 2015 Thursday ,04 June

Pluto's unruly moons
Arab Today, arab today Hyundai allows Saudi journalists

GMT 15:14 2016 Thursday ,01 December

Hyundai allows Saudi journalists
Arab Today, arab today Latest Infiniti QX to compete

GMT 13:16 2016 Saturday ,26 November

Latest Infiniti QX to compete
Arab Today, arab today Austria's race against time

GMT 11:44 2016 Thursday ,01 December

Austria's race against time
Arab Today, arab today Car manufacturers to power Europe

GMT 13:01 2016 Tuesday ,29 November

Car manufacturers to power Europe

GMT 12:45 2016 Tuesday ,29 November

To find German funny bone

GMT 13:52 2016 Monday ,28 November

Punk memorabilia torched

GMT 04:15 2016 Thursday ,30 June

World's largest uncut diamond fails

GMT 12:39 2016 Friday ,25 November

Arctic 9-12C above normal

GMT 15:59 2015 Wednesday ,27 May

Seoul elevates gardening to high art

GMT 12:39 2016 Saturday ,26 November

Skin patch could help kids

GMT 13:19 2016 Monday ,21 November

New nationalism stoking fears

GMT 13:12 2015 Saturday ,09 May

Sheikh Sultan opens Sharjah Centre

GMT 09:53 2016 Sunday ,15 May

OMEGA official timekeepers
Arab Today, arab today
Arab Today, arab today
 
 Arab Today Facebook,arab today facebook  Arab Today Twitter,arab today twitter Arab Today Rss,arab today rss  Arab Today Youtube,arab today youtube  Arab Today Youtube,arab today youtube

Powered and Developed by FilmMatters

Copyright © 2016 Arabtoday

Developed by FilmMatters

© 2016 Arabtoday

arabtoday arabtoday arabtoday
arabtoday
بناية النخيل - رأس النبع _ خلف السفارة الفرنسية _بيروت - لبنان
arabtoday, Arabtoday, Arabtoday