The annual inflation rate inched up in February to the highest level since late 2006 due to higher food prices, while the central bank decided to maintain its benchmark interest rate at 8%, Reuters reported. The consumer price index (CPI) in February rose 7.40% from a year earlier, higher than January's 7.36%, the Central Bureau of Statistics reported. It marks the strongest annual inflation rate since September 2006, when the CPI had risen 14.55% from a year earlier. "February's inflation was slightly higher because soaring global commodity prices affect domestic food prices," said economist Destry Damayanti of Mandiri Sekuritas.
The central bank left its key interest rate unchanged at 8.0% on Thursday for the third month in a row, as predicted by economists. The key rate has fallen from a peak of 12.75% in late 2005. The statistics bureau also reported that January exports rose 33.2% from a year earlier after a 13% rise in December. The rise was well above market expectations of a 19.9% increase.
Meanwhile, imports grew 43.9% in January. That compared with an annual rise of 36.8% in December. The trade surplus was $3.48 billion, higher than a forecast $3.2 billion. (www.ekon.go.id)
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