The World and Inflation

The world’s supply chain problems will not have a significant impact on Indonesia\'s inflation, because the sharp increase in the pent-up demand in Indonesia mostly occurred domestically.

KOMPAS/ADITYA PUTRA PERDANA

The atmosphere of loading and unloading absorbed rice at the Katonsari Bulog Warehouse, in Katonsari Village, Demak District, Demak Regency, Central Java, Friday (19/3/2021).

The perception that the Delta variant and its impact are finally under control has triggered an increase in West Texas Intermediate (WTI) crude oil prices, which recently passed the US$70 mark to reach $76.50 per barrel. China is trying to control the cost push inflation by using its strategic oil reserves to control the rising oil prices. But these efforts have not been effective as the positive outlook on the world economic recovery continues to push up WTI crude prices. However, an interesting prediction made by Morgan Stanley in September was that if world oil prices reached the range of $80 per barrel, it could have the potential to damage the world\'s economic recovery which would, in return, hit oil prices again.

World supply chain