BI: Year to Year Inflation May Drop to 7.18 Percent
21 April 2014 18:44 WIB
TEMPO.CO, Jakarta - Bank Indonesia Governor Agus Martowadojo is optimistic that the year on year inflation will drop by more than one percentage to 7.18 percent following positive signs in April.
"The [monthly] deflation will range between 0.08 percent and 0.1 percent. But it is a consistent condition," Agus said on Monday, April 21, 2014.
The central bank observed that commodities such as cayenne pepper and rice would contribute most the highest number of deflation because farmers in East Java had started to grow cayenne pepper after Kelud eruption, creating a correction effect to prices. Furthermore, coordination between the central and local governments should be effective in controlling inflation.
Agus referred to the Philippines as an example of good financial management through natural disaster.
"The Philippines controlled inflation rate at around 3 percent," he said.
For Indonesia, Agus forecasted that the 2014 inflation target of 3.5 to 5.5 percent could be achieved after the government and central bank applied several measures.
MARIA YUNIAR
