THE MINISTER OF FINANCE OF THE REPUBLIC OF INDONESIA, NUMBER 1/KMK.011/2008
CONCERNING
THE INFLATION TARGET FOR 2008, 2009 AND 2010
THE MINISTER OF FINANCE OF THE REPUBLIC OF INDONESIA,
Considering:
a. whereas pursuant to Article 10 of Act Number 23 of 1999 concerning Bank Indonesia as amended by Act Number 3 of 2004, Bank Indonesia is vested with the power to establish monetary targets with reference to the inflation target adopted by the Government after coordination with Bank Indonesia;
b. whereas pursuant to Article 21 of Act Number 17 of 2003 concerning State Finances, the Government and Bank Indonesia shall coordinate actions in the establishment and implementation of fiscal and monetary policy;
c. whereas pursuant to Article 7 of the Memorandum of Understanding of the Government and Bank Indonesia dated 1 July 2004 concerning the Mechanism for Targeting, Monitoring and Control of Inflation in Indonesia, the Government shall stipulate the inflation target in a Decree of the Minister of Finance;
In view of:
1. Act Number 23 of 1999 concerning Bank Indonesia (State Gazette of the Republic of Indonesia Number 66 of 1999, Supplement to the State Gazette of the Republic of Indonesia Number 3843) as amended by Act Number 3 of 2004 (State Gazette of the Republic of Indonesia Number 7 of 2004, Supplement to the State Gazette Number 4357);
2. Act Number 17 of 2003 concerning State Finances (State Gazette of the Republic of Indonesia Number 47 of 2003, Supplement to the State Gazette of the Republic of Indonesia Number 4287);
3. Presidential Decree Number 20/P of 2005;
With attention to:
The Memorandum of Understanding of the Government and Bank Indonesia dated 1 July 2004 concerning the Mechanism for Targeting, Monitoring and Control of Inflation in Indonesia.
HAS DECREED:
To enact:
THE DECREE OF THE MINISTER OF FINANCE CONCERNING THE INFLATION TARGET FOR 2008, 2009 AND 2010.
Article 1
1. "Inflation Target" is the desired level of inflation with a specified time frame.
2. "Consumer Price Index" (headline inflation), hereinafter referred to as CPI inflation, is the increase in the CPI from one specified time to another specified time, calculated and published by the Central Statistics Agency.
Article 2
(1) The Inflation Target to be established and announced is annual CPI inflation (year-on-year).
(2) The form of the established Inflation Target shall be a specific number with a tolerance range (point with deviation).
(3) The Levels and Periods for the CPI Inflation Target are stipulated as follows: a. 5.0% for 2008;
b. 4.5% for 2009; and c. 4.0% for 2010,
with a deviation of 1.0% (one percent).
Article 3
Article 4
To monitor inflation, the Central Statistics Agency (BPS) shall provide information to explain the developments and causes of inflation in the monthly meeting of the Inflation Control Coordination Forum.
Article 5
This Decree of the Minister of Finance shall come into force on the date of its enactment.
For the public to be informed, it is ordered that this Decree of the Minister of Finance be promulgated in the State Gazette of the Republic of Indonesia.
Enacted in Jakarta Dated 3 January 2008 THE MINISTER OF FINANCE,
(signed)
