UPDATE 2-Indonesia Dec trade surplus biggest in 2 years as exports surge
* Dec trade surplus at $1.52 bln vs $550 mln surplus in poll
* Jan annual inflation at 8.22 pct vs 8.38 pct in poll
* Rupiah, stocks pare losses after data
* Next central bank rate review due on Feb 13 (Adds analyst reaction, updates market prices,)
By Rieka Rahadiana and Adriana Nina Kusuma
JAKARTA, Feb 3 (Reuters) - Indonesia posted its third straight monthly trade surplus in December and its biggest in two years, an encouraging sign that could give the central bank leeway to keep rates steady next week despite investor anxiety over strains in emerging markets.
Indonesia's rupiah - one of the so-called Fragile Five emerging market currencies - slid more than 20 percent against the dollar in 2013, hit by investor unease about the country's high current account deficit and the impact of a reduction in U.S. monetary stimulus.
The spectre of additional Federal Reserve tapering has further roiled other emerging market currencies this year, prompting central banks like Turkey's and India's to raise rates in just the past week, but the rupiah has held largely steady so far in 2014.
"Bank Indonesia will no doubt be breathing somewhat easier after today's release," said Robert Prior-Wandesforde, an economist at Credit Suisse in Singapore.
"Although the government's partial export ban on unprocessed ores means the central bank can't afford to drop its guard, the chances of being bounced into further monetary tightening by jittery markets in the next couple of weeks has undoubtedly fallen."
The trade surplus in December totalled $1.52 billion, the largest since December 2011, the statistics bureau said on Monday. That followed a revised $790 million surplus in November and was more than double the median estimate of a $550 million surplus in a Reuters poll of economists.
The rupiah and the local equities market pared losses after the release of the data. The currency stood at 12,215 to the dollar at 0530 GMT, while the Jakarta stock market was down 0.4 percent.
"Definitely, this is positive for sentiment in the markets, and it will be interesting how much of an impact this latest number will have on the current account data for 4Q13," said Gundy Cahyadi, an economist at DBS Bank in Singapore.
"We have forecast the current account deficit at 3.4 percent of GDP in 2013, but now see some chance of it coming in slightly narrower than our expectations."
Bank Indonesia, which will hold its next rate review on Feb. 13, has estimated that the overall 2013 current account deficit would be below 3 percent of gross domestic product, due to improved demand in the fourth quarter.
Indonesia's trade deficit widened to $4.06 billion in 2013 from $1.63 billion in 2012, on robust demand for imported fuel, automobiles and other consumer goods. The deficit in 2012 was the country's first in the modern era.
The trade surplus in December was driven by an unexpected surge in exports - up 10.33 percent from a year earlier versus analysts' expectations for a 1.80 percent rise - due in part to a weaker rupiah and front-running of ore shipments ahead of the January ban.
December imports fell 0.79 percent, against an expected 3.60 percent drop.
For 2013, exports fell 3.92 percent and imports dropped 2.64 percent.
Analysts warned that the trade picture will become more uncertain starting with the January data, after the government on Jan. 12 banned exports of unprocessed mineral ore. Around $500 million worth of monthly mineral ore and concentrate shipments have ground to halt due to uncertainty over the new policies.
"The uncomfortable question facing Indonesia remains: Can the trade balance stay safely in surplus when the effect of the well-intended but ill-timed mining ban manifests in the data due out this time next month?" said Wellian Wiranto, an economist at OCBC Bank in Singapore.
Indonesia's consumer price index rose 8.22 percent in January from a year earlier, the statistics bureau also said on Monday, after torrential rain and natural disasters disrupted the distribution of goods. The result was in line with an 8.38 percent increase projected in a Reuters poll of economists.
The data was the first to reflect the new 2012 base year.
Core consumer prices, which exclude administered and volatile food prices, rose 4.53 percent from a year earlier in January, mainly due to the weakening of the rupiah.
For 2013, the inflation rate jumped to 8.38 percent following a surge in fuel prices and disruptions to food supplies stemming from adverse weather.
Some analysts have said Bank Indonesia should increase its key reference rate in the first half of 2014 to contain inflation and possible outflows after the Fed's tapering, even at the cost of lower economic growth.
The central bank raised its benchmark rate by a total of 175 basis points between June and November to maintain investors' confidence, due to nagging worries about the country's ability to finance its economy. (Additional reporting by Andjarsari Paramaditha; Editing by Randy Fabi and Chris Gallagher)