Monthly inflation soars to 8.56 percent

JAKARTA (JP): Indonesia's July inflation rate soared to 8.56 percent from 4.64 percent in June as prices of basic commodities continued to soar, the Central Bureau of Statistics (BPS) announced yesterday.

The bureau said the January-to-July inflation figure rose to 59.1 percent, compared to 3.78 percent for the corresponding period in 1997.

Inflation in the first four months of the current fiscal year which began in April was 25.16 percent.

"July's rate is the highest monthly inflation since February's rate of 12.76 percent," the bureau's chief Sugito Suwito told reporters.

The 12.16 percent rise in the prices of foodstuffs contributed 36.68 percent of the total inflation rate.

The prices of rice, cooking oil and gold jewelry recorded the highest increase, followed by prices of detergent powder, clove cigarettes, women's clothing and color televisions.

Sugito said distorted distribution triggered the high inflation in some cases.

"In the case of cooking oil, some retailers and market traders said they had limited stocks, some claimed they were insufficiently supplied and others said they bought the products from suppliers at higher prices," he said.

He said the removal of subsidies on certain commodities such as wheat had also encouraged traders to increase prices.

Sugito said he was optimistic that inflation would not exceed 80 percent this year.

"We still have five more months to suppress price increases," he said.

He said foreign aid disbursements to Indonesia would help curb inflation, despite the December holiday season when prices are normally jacked up.

Sugito said exports from January to May this year slid 4.9 percent to US$20.11 billion from $21,14 billion in the same period last year.

Non-oil and gas exports in the same period rose year-on-year 4.3 percent to 16.67 billion, but oil and gas exports dropped 33.4 percent to $3.43 billion.

Imports fell 38 percent in the first five months to $11.06 billion.

Oil and gas imports declined 22 percent to $1.30 billion, while imports of non oil and gas products dropped 39.6 percent to $9.75 billion.

Sugito said exports in May reached $3.94 billion, down from $4.56 billion in the same month last year.

Oil and gas exports were also down, to $647.81 million from $932 million in May 1997, while non-oil and gas exports fell to $3.29 billion from $3.63 billion.

Total imports in May almost halved to $1.93 billion from $3.61 billion in May 1997.

May imports of oil and gas products dropped to $193.01 million from $284.3 million, while imports of non-oil and gas products fell to $1.74 billion from $3.32 billion. (das)