Inflation higher in April on rising food prices: BPS
Inflation higher in April on rising food prices: BPS
The Jakarta Post, Jakarta
The consumer price index (CPI) rose by 0.97 percent in April from
the level in March as prices of goods and services increased
during the month, the Central Statistics Agency (BPS) reported on
Tuesday.
BPS said that year-on-year inflation in April (inflation in
April 2004 compared to inflation in April 2003) increased to 5.92
percent from on-year inflation of 5.11 percent in March.
Despite the higher inflation, most analysts are still
optimistic that full-year inflation rate would be lower than the
government's target of 6.5 percent this year.
This should pave the way for the central bank to further cut
the domestic interest rate to make bank loans more affordable to
the corporate sector.
Indeed, the benchmark interest rate on Bank Indonesia one-
month SBI promissory notes has now gone down to a record low of
7.33 percent. But central bank officials have said that the
benchmark rate could go down to the 6 percent level before the
end of the year.
BPS said that price increases in almost all categories of
foods and services: basic foods (prices increased by 1.78
percent), processed food, beverages, cigarette and tobacco (0.32
percent), housing, water, electricity, gas and fuel (1.23
percent), clothing (0.24 percent), and transport, communications
and financial services (0.44 percent), all contributed to the
increased inflation rate.
It did not explain the reason for the higher prices in the
above components.
BPS said that the largest contributor to the April inflation
was basic foods, in which the price of poultry and chicken
products saw the largest price increase.
This may have something to do with decreasing fears about bird
flu, as people are now less reluctant to eat chicken.
Meanwhile, the increase in phone charges starting earlier last
month also contributed to the higher prices in telecommunication
services.
Steps taken by the authorities to limit sugar imports and curb
the smuggling of sugar into the country to protect local farmers
had also put upward pressure on sugar prices at home.
Analysts also said that the weakening of the rupiah against
the U.S. dollar in April had made hiked the cost imported
materials, putting pressure on prices at home.
The country's production system is still heavily dependent on
imported raw materials.
Exports up 3.43%
The country's exports increased by 3.43 percent in March to
US$5.07 billion from $4.90 billion in February, the Central
Statistics Agency (BPS) reported on Tuesday.
The agency said that the increase was driven by higher exports
of oil and gas commodities and non-oil and gas products.
But BPS said that exports in the first quarter of this year
(January to March) slightly declined by 0.89 percent from the
same period last year mainly on lower oil and gas export value.
Oil and gas exports in March bounced back to $1.19 billion
compared to February's $1.13 billion due to a 9.94 percent and
3.49 percent increase in exports of crude oil and natural gas,
respectively.
Non-oil and gas exports during the month recorded a 2.86
percent increase from $3.76 billion to $3.87 billion.
The government has set a total export target of $59.4 billion
for this year.
Elsewhere, BPS said that imports in March rose 8.3 percent to
$3.13 billion from $2.89 billion in February. The import figure
jumped by 11 percent from $2.82 billion in March of last year.
The higher import caused the country's trade surplus for the
month to fall to $1.94 billion from $2.01 billion in February.
Some analysts have said that the higher import figure could
signal more active business activities. -- JP