There were some adjustments on numbers of the accounts on 2Q19, such as on Financial account surplus remained significant and CAD was lower than our expectation at 2.9% of GDP.
Flipped back to a trade surplus in August. Trade surplus may lead BI to become more confident to continue loosening monetary policy coupled with stronger Rupiah in the last couple of days.
Low inflation opened room for BI cutting rate for first time since 2017 to support growth.
If a trade deal to lift up previous tariff sanction is reached, it may give a boost to US and China economic.
Late harvest in several places as mentioned by coordinating minister of economic, mainly due to distributional problems. It made supply of shallot, chili, vegetables and some other food products were limited, hence boost the price.
Currency movement is also favorable as Rupiah move within 13,800 – 14,300 range.
Bank Indonesia (BI) will start its two-day board of governor meeting in Feb 20 and announced the result in Feb 21.
Initially, we expect that airlines baggage fee will push transportation inflation higher in January.