Consumer price up 1st time in eight months

JAKARTA (JP): The consumer price index (CPI) rose by 0.06 percent in October from the previous month, the first inflation since March, head of the Central Bureau of Statistics (BPS) Sugito Suwito said on Monday.

Sugito said that the year-on-year inflation was 1.58 percent.

"Higher gold jewelry prices and transportation costs were the major contributors to the inflation," he told a press conference.

"If gold jewelry is taken out from the CPI basket, last month still saw a deflation of 0.04 percent," he added, pointing out that food prices continued to decline.

BPS reported that the CPI in October was 198.79, compared to 198.68 in September, resulting in inflation of 0.06 percent.

BPS said that cumulative inflation for the first eight months was 0.08 percent, while inflation for the first seven months of the 1999/2000 fiscal year (April to October) was minus 3.85 percent.

Sugito said the General Session of the People's Consultative Assembly last month affected the exchange rate of the rupiah against the U.S. dollar which in turn sent prices higher, particularly of gold jewelry.

"Every political agenda has an impact, but thank God the impact was not too big," he said.

Indonesia held its first democratic presidential election in 50 years last month.

Sugito forecast that inflation for the whole calendar year would be less than 2.5 percent if "nothing extreme" occurred in December, during which the Christmas celebration and the Muslim fasting month will coincidentally take place.

Bank Indonesia expects inflation this year to be about 2 percent.

Indonesia suffered hyperinflation of more than 77 percent last year when the economic crisis deepened and the rupiah fell to as low as Rp 17,000 against the dollar.

The economy has posted steady deflation since March, which economists say mostly reflects the people's eroded purchasing power during the economic crisis.

BPS said that food prices continued to fall by 0.76 percent in October.

It also reported that prices of processed food, beverages and cigarettes fell by 0.06 percent.

But BPS said that housing costs rose by 0.2 percent, clothing prices by 1.13 percent, health costs by 0.03 percent and recreation, education and sports costs by 0.38 percent.

The bureau reported that transportation and communication costs increased 0.81 percent.

On foreign trade, BPS said exports in September declined by 2.34 percent to US$4.49 billion, from $4.60 billion in August.

Exports in January to September were recorded at $35.01 billion, or down 6 percent compared to the same period in 1998, BPS said.

The bureau said that non-oil and gas exports were down 0.15 percent to $3.58 billion in September and declined by 9.11 percent in the first nine months, compared to the same period last year.

BPS reported that imports in September slightly increased to $2.02 billion from the level in August.

"But this rise is rather negligible. This also means that exports over the next two to three months will remain low, given the heavy reliance of industrial exports on imported raw materials," Sugito said.

BPS said that imports for the January to September period were valued at $17.59 billion, or a 12.76 percent decline from the level in the same period last year.

Consumer good imports between January and August were recorded at $1.57 billion, or a 29.31 percent increase compared to the same period last year.

"This means that our industry has not yet recovered," Sugito said.

BPS said that imports of raw materials in the January to August period declined by 4.24 percent, while imports of capital goods dropped by 53.70 percent.

"This indicates a depressed condition in the manufacturing sector," Sugito added.

BPS said tourist arrivals in September were recorded at 342,832, up by 3.95 percent from the level in August.

"Usually, the tourist sector provides a boost to the economy when exports are weak," Sugito said.

But due to political and social unrest in the country, tourists arrivals were low, he added. (rei)