Inflation up in September as rupiah falls<\/p>\n
Adianto P. Simamora, The Jakarta Post, Jakarta<\/p>\n
Inflation was up in September due to a decline in the value of
\nthe rupiah, raising concerns that the government's 2001 single
\ndigit inflation target may not be met.<\/p>\n
The Central Bureau of Statistics (BPS) announced Monday that
\nthe consumer price index rose 0.64 percent month-on-month in
\nSeptember, compared to the deflation of 0.21 percent recorded in
\nAugust.<\/p>\n
The agency said that year-on-year inflation during the month
\nreached 13.01 percent compared to 12.23 percent in the previous
\nmonth.<\/p>\n
While most prices increased during the month, food prices fell
\nby 0.73 percent, the BPS said.<\/p>\n
\"The rises were primarily caused by an increase in the price
\nof goods and services,\" BPS deputy officer for statistics and the
\neconomy Slamet Mukeno said at a media briefing.<\/p>\n
Economists have said that the drop in the value of the rupiah
\nagainst the U.S. dollar will push prices upward particularly as
\nthe country's production system is still heavily dependent on
\nimported raw materials.<\/p>\n
The rupiah weakened to around Rp 10,000 per dollar last month
\nas corporations purchased hard currency amid growing anti-U.S.
\nprotests in the country.<\/p>\n
Economists said that with inflation over the next few months
\nlikely to remain high, the government may fail to cap this year's
\ninflation level at the targeted figure of around 9.3 percent.<\/p>\n
\"It will be very difficult for the government to meet such an
\ninflation target in the remaining three months of this year,\" PT
\nDanareksa Securities senior economist Raden Pardede told The
\nJakarta Post.<\/p>\n
\"Annual inflation this year may hit 11 percent,\" he added.<\/p>\n
Raden explained that inflationary pressure over the remaining
\nperiod of the year would come from the year-end festivities, the
\ngovernment plan to raise electricity charges this month, and
\ncontinuing pressure on the rupiah.<\/p>\n
Maintaining single digit inflation is seen as a crucial factor
\nin helping to revive confidence in the ailing economy and
\ncurrency.<\/p>\n
The prospect of higher inflation would also prevent the
\ncentral bank from lowering interest rates, a move which is badly
\nneeded to reinvigorate the business sector.<\/p>\n
Slamet also said that inflation over the next three months
\nwould likely go higher, although he declined to say whether the
\ngovernment's 2001 target was still within reach.<\/p>\n
\"Based on past experience, prices usually move higher by up to
\nthree percent in the October-December period,\" he said<\/p>\n
\"The year-end festivities such as Christmas and the Muslim
\nfasting month, as well Idul Fitri (post-fasting month holiday),
\nwill all serve to push inflation higher,\" he explained.<\/p>\n
Elsewhere, the BPS also reported that exports rose by 4.4
\npercent in August to US$5.06 billion from the previous month's
\n$4.83 billion on the back of an increase in non-oil and gas
\nexports.<\/p>\n
\"Non-oil and gas exports increased to $4.13 billion in August
\nfrom $3.77 billion in the previous month, while oil and gas
\nexports declined 13.6 percent to $925 million from $1.07
\nbillion,\" the BPS said in the report.<\/p>\n
He said the decline in oil and gas exports was due to a fall
\nin crude oil and gas exports.<\/p>\n
\"The decline in crude oil exports was on the back of a mild
\ncorrection in the price of Indonesian crude oil on the
\ninternational market to $24.36 per barrel in August from $24.70
\nin July,\" Mukena said.<\/p>\n
The Bureau said that during the eight months to August, the
\nvalue of exports reached $39.25 billion as against $40.32 billion
\na year earlier, of which non-oil and gas exports accounted for
\n$30.26 billion as against $31.32 billion in the previous year,
\nand oil and gas exports $8.99 billion as against $8.99 billion.<\/p>\n
The U.S. remained Indonesia's biggest export destination,
\nfollowed by Japan and Singapore.<\/p>\n
Total exports to the U.S. reached $652.7 million as against
\n$622.9 million in July,<\/p>\n
Meanwhile, exports to Japan totaled $639.7 million as against
\n$560.9 million the previous year, and exports to Singapore $467.1
\nmillion as against $384.4 million.<\/p>\n
Slamet said, however, that the country's exports to the U.S.
\nover the following months could be lower following the recent
\nterrorist attacks on New York and Washington.<\/p>\n
\"Under normal conditions, exports to the U.S. are usually
\nhigher in September than in August as U.S. demand for textiles
\nand shoes rises on seasonal factors such as the onset of winter
\nand ahead of Christmas,\" he said.<\/p>\n
\"But as the situation is not normal following the Sep. 11
\nattacks on the World Trade Center, I am afraid that our exports
\nto the U.S. will fall significantly,\" he said.<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/inflation-up-in-september-as-rupiah-falls-1447893297",
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