Inflation 1.16% in January

Inflation 1.16% in January

JAKARTA (JP): Increases in the prices of food, clothing and housing resulted in an inflation rate of 1.16 percent in January, Minister of Information Harmoko announced yesterday.

He told reporters after a limited cabinet meeting on the economy at the Bina Graha presidential office that the January inflation rate was caused by a 1.65 percent increase in food prices at the capitals of the country's 27 provinces, 1.14 percent rise in clothing prices, 1.01 percent hikes in housing prices and 0.75 percent increment in the prices of other goods and services.

"The January inflation was higher than the 0.52 percent inflation last December but it was lower than the 1.25 percent inflation in January 1994," said Harmoko.

He said that the large increase in food prices was caused mainly by a sharp rise in rice prices in various cities.

"Rice prices, for example, rose 10.81 percent in Ujungpandang, 8.98 percent in Manado, 8.49 percent in Surabaya, 7.52 percent in Semarang, 7.75 percent in Jakarta and 7.05 percent in Padang," he said.

However, the rates of the rice price increases were still far lower than the 11 percent recommended by the government.

The government announced last October that the floor price of husked rice paid to village cooperatives by the national Logistics Board (Bulog) should be raised by 11 percent to Rp 657 per kilogram in January.

Harmoko said yesterday that President Soeharto, concerned about January's high inflation rate, had instructed the Central Bureau of Statistics (BPS) to study the reasons behind the soaring food prices.

"The President was concerned because (the rise occurred in spite of the fact that) distribution of a number of foodstuffs has been improved," he said.

The minister said that the government, in trying to control inflation prior to the Idul Fitri holiday in early March, has encouraged additional supplies of foodstuffs, particularly edible oil, sugar and flour.

The monthly supply of edible oil, for example, is expected to reach 175,460 tons, far higher than the demand, estimated at 137,485 tons, he said.

He said that a few days before and after the Idul Fitri holiday on March 3-4, the government will also provide additional supplies of meat, chicken and eggs at market places to prevent price escalation.

Prices usually increase prior to the Idul Fitri holiday, thereby causing a rise in the inflation rate. The inflation rate in February 1994, one month before the same holiday, increased to 1.76 percent from 1.25 percent in the previous month.

Export

Yesterday's meeting also reported that Indonesia's exports reached US$36.29 billion during the first 11 months of 1994, $27.6billion of which was contributed by non-oil products and $8.68 billion by oil and gas.

Because imports reached only $28.65 billion, Indonesia enjoyed a trade surplus of $7.63 billion in the January-November period of 1994, Harmoko said.

He said that during November alone, the country's exports reached $3.64 billion, while imports were recorded at $2.79 billion, thereby resulting in a trade surplus of $855.8 million.

The November exports consisted of $2.77 billion of non-oil products and $874.8 million of oil and gas, he said.

He said the meeting also reported that the country's money supply increased by 2.6 percent to Rp 45.62 trillion ($20.6 billion) as of last December from Rp 44.43 trillion as of last November.

The December figure indicates that the money in circulation grew by 23.18 percent during 1994. Data at Bank Indonesia shows that the money supply was recorded at Rp 37.03 trillion as of the end of 1993. (riz)