TEMPO.CO, Jakarta – Indonesian Retailers Association (Aprindo) chairman Tutum Rahanta said the rupiah's weakening against the US dollar would lead to increased prices of domestic goods.
“Raw materials are getting expensive. Automatically, production costs and production basic prices will increase as well,” Tutum told Tempo on Monday, October 6, 2014.
According to Tutum, the price hike was allowing for the rupiah’s weakening against the US dollar from Rp10,000 to Rp12,000. Tutum, however, could not estimate the amount of the price hike should the rupiah continue to plummet.
“Business owners are waiting for the new president’s inauguration. Hopefully, things will be more stable,” he said.
Tutum added he could not predict the percentage of the price hike yet as it was still too early to increase the basic price for production.
Coordinating Minister for the Economy Chairul Tanjung said among the factors causing the decline of the rupiah was the country's political situation. The rupiah plunged to Rp12,175 per US dollar in Monday's closing session.
YOLANDA RYAN ARMINDYA