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Effects of Inflation

Under the Banner of Inflation

Tuesday, November 15, 2005

The quality of banking loans plummeted during the third quarter of this year. It is expected that increased interest rates will continue for the next six months.

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THE closing stages of the fuel price increases have now begun to affect Indonesias banking industry. Last week, in the run-up to the Lebaran holidays, Bank Indonesia (BI) announced its estimate that the annual rate of inflation would reach 14 percentfar higher than the initial calculations of around 7 percent. This year theres no way that the rate of inflation will be only one digit, said BI Governor Burhanudin Abdullah.

It is difficult to deny t

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