Indonesian inflation hits record low in 2009: gov't

"These two factors mean there are no drastic increases in the prices of commodities like food and transport so they remain very low," Ciptadana Securities head of sales John Teja told AFP.

"The inflation this year is a record low. Last year's inflation was nearly 10 percent," he added.

Indonesia's Consumer Price Index rose 2.78 percent in December compared to the same month a year earlier. The inflation rate for the full year is defined as the year on-year rise in December.

On-month inflation edged up to 0.33 percent in December from negative 0.03 percent in November as processed food and clothing prices increased, the agency said.

Year-on-year core inflation, which excludes volatile food items and government-set prices, was 4.28 percent compared with 4.29 percent in November.

Clothing prices rose 0.95 percent on the month while processed food prices were 0.93 percent higher, agency chairman Rusman Heriawan told reporters.

Transportation and communications prices increased 0.35 percent from November, housing and energy costs gained 0.28 percent and healthcare costs were 0.20 percent higher, he added.

Bank Indonesia is expected to keep its key interest rate steady at 6.50 percent when it meets Wednesday.

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