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Indonesia surprises with a sizable November trade surplus

Indonesia reported a surprisingly large trade surplus for November, while inflation was steady last month, which could give the central bank room to keep its benchmark rate unchanged next week.

Data from the statistics bureau showed a trade surplus of $780 million in November, compared with a projected $70 million deficit in a Reuters poll.

(Read more: Indonesia gets ready for Fed tapering)

The rupiah strengthened slightly on the news, to 12,200 to the U.S. dollar from 12,205, compared with the previous close of 12,160.

November's exports fell 2.4 percent on an annual basis, but imports dropped 10.55 percent as demand was subdued, apparently in part because the weak rupiah has raised import costs.

Sha Ying | CNBC

The Reuters poll had forecast a 1.9 percent drop in exports and a 7.4 percent decline in imports from a year earlier.

In 2013, the rupiah was emerging Asia's worst-performing currency, weakening 21 percent.

In a bid to reduce Indonesia's large current account deficit and aid the beleaguered rupiah, Bank Indonesia has raised its key reference rate by 175 basis points since June to 7.50 percent.

Its next policy meeting is on Jan. 9.

(Read more: Indonesia's central bank unexpectedly raises rates)

"The improvement in trade will give some room for the central bank to pause in the next board meeting," said Aldian Taloputra, economist at Mandiri Sekuritas.

Still, he thinks Bank Indonesia is likely to raise its benchmark 25-50 basis points in 2014 to bring the country's current-account deficit to a "more sustainable level".

Joshua Pardede, economist at Bank Internasional Indonesia, said it's still possible the central bank will increase rates on Jan. 9, given the rupiah's sharp depreciation in 2013.

Consecutive trade surpluses

November's surplus was the largest since March 2012, and it lets Indonesia have consecutive monthly trade surpluses for the first time since August-September 2012. On Thursday, the statistics bureau revised the surplus for October to $30 million from the originally-reported $50 million.

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