The Central Java representative of Bank Indonesia (BI) predicted that the countrys inflation in August would be lower at 0.02 percent from 0.14 percent in July.
“The decline in inflation was a result of a cut in the prices of a number of essential goods,” Rahmat Dwisaputra of the Central Java representative of the central bank said here on Tuesday.
Rahmat said the inflation should be stable at a lower level, adding after Ied ul Fitr inflation would be as expected by the government.
“In June and July inflation rates were quite high. That is the trend. We will stabilize the inflation that price hike is no longer high,” he said.
In addition to the falling prices of essential goods especially volatile foods such as chili, garlic, and red onion, the cost of education is also expected to contribute to the decline in inflation in August.
The time when the people have to pay extra for education has been over that there is less factors contributing to inflation.
“In September, inflation is even expected to remain low with low consumption by the people,” Rahmat said.
With the stability maintained the purchasing power of the people is expected to be unaffected, he added.