Indonesia ’s economic growth stood at 5.62 percent in the third quarter of 2013, the lowest rate in the past four years, the country’s Central Statistics Agency (BPS) announced on November 6.

According to the BPS, the economic slowdown this year was attributed to a decrease in the demand for its exports like coal and rubber, especially from China – its main consumer.

The situation even deteriorated in recent months as the country’s inflation surged due to fuel price hikes and the rupiah plummeted on fears that the US may taper off its huge stimulus programme.

In order to curb inflation and raise the value of the rupiah, Indonesia has tightened its monetary policy by raising the interest rate by 1.5 percent since June.

Thanks to these efforts, the October inflation was down to 8.32 percent from 8.40 percent in September, however, it is still the highest level in more than four years. High inflation caused a reduction in household consumption, which contributes more than 50 percent of the country’s GDP.

Indonesia ’s central bank has lowered its projection for the domestic economic growth in 2013 to 5.5-5.9 percent from 5.8-6.2 percent set previously.-VNA