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Indonesia hikes key interest rate on surging inflation |
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16:53, June 05, 2008 |
The Indonesian central bank Thursday raised the benchmark interest rate by 25 basis points to 8.5 percent after the May inflation hit a 20-month high.
The decision was taken during the board of governor meeting led by Bank Indonesia Governor Boediono here.
The inflation hit 10.38 percent in May and the bank is expecting faster pace in the coming months.
"Fuel price rises will drive up the inflation and by the end of 2008 the inflation is estimated to end at 11.5 percent to 12.5 percent," central bank deputy governor Hartadi told a press conference after the meeting.
Source: Xinhua
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