BI: Fuel Hike Pushes Inflation by 0.3%
31 March 2015 13:10 WIB
TEMPO.CO, Jakarta - The increased prices of gasoline and diesel fuel throughout March 2015 is expected to push the month's inflation up by 0.3 percent. Bank Indonesia governor Agus Martowardojo is confident the price hike will have no significant impact on the yearly rate of inflation.
"A fuel hike of Rp500 will affect inflation by 0.27 to 0.3 percent. Components that with the biggest effect on inflation are still rice and onions," he said in Jakarta yesterday.
According to Agus, the fuel subsidy mechanism now is better because the government can give more attention to the infrastructure sector, which has often been neglected. "In the longer term, inflation will be stable," he said.
Fuel prices have been raised twice in March 2015, taking into account the weak rupiah and the increased MOPS benchmark price for gasoline. Agus said that the government can still manage fuel prices if there is more turmoil in world oil prices.
BI Deputy Governor Perry Warjiyo projected that Indonesians will feel the impact of fuel price hikes by April, where inflation is expected to inch up by 0.04 percent. To control inflation due to rising fuel prices, BI recommends local governments to regulate public transportation rates.
ADITYA BUDIMAN | EDWIN FAJERIAL (SURABAYA) | PHESI ESTER JULIKAWATI (BENGKULU) | ROBBY IRFANY
