Bank Mandiri Economist: Energy Commodity Price Movement Influenced By Non-Meredating Political Tennision

JAKARTA - PT Bank Mandiri (Persero) Tbk (BMRI) said that the Indonesian economy will still face various global economic risks, one of which is inflation.

Bank Mandiri Chief Economist Andry Asmoro revealed that the Indonesian economy will still face various global economic risks, namely energy prices, food and US interest rates.

"Energy and food prices need to be watched out for next year, considering that there are events related to the two," Andry said in Media Gathering, Tuesday, December 19.

Andry said that the movement of energy prices would be influenced by geopolitical tensions that had not subsided and food prices came from the phenomenon of a long drought or El

"If El Rujuk is prolonged, it will raise rice prices, as well as chilies, and onions. Even though these commodities are dominant in food for the Indonesian people," he explained.

On the other hand, the slowdown in China's economy will still be a risk to the Indonesian economy considering that China is one of the main trading partners and investment partners for Indonesia.

However, if the Federal Reserve lowers US interest rates more quickly, global sentiment will improve and the potential for the return of foreign funds in the future will be more open.

In line with that, Bank Indonesia has the opportunity to lower interest rates by 50 bps by 2024.

Andry said the inflation rate remained under control in the range of 2 to 4 percent according to Bank Indonesia's target in 2023, and was expected to continue to decline.

In addition, the inflation rate in 2023 is expected to reach 3 percent and by 2024 it will reach 3.19 percent, according to BI estimates.

Furthermore, good supply management also supports the rate of decline in inflation, especially in terms of food prices.