Rupiah Correction Triggers Core Inflation Hike
2 April 2015 12:52 WIB
TEMPO.CO, Jakarta - The Central Statistics Agency (BPS) said that the rupiah's free fall to around Rp13,000 per US dollar has triggered an increase in March's core inflation rate.
This is visible in the continuing hike of core inflation continues over the last three months. The rate was 4.99 percent in January, edged down to 4.96 percent February, before jumping back up to 5.04 percent in March.
"I believe Bank Indonesia needs to intervene," BPS deputy for distribution and services statistics, Sasmito Hadi Wibowo, said yesterday.
The central bank's intervention, he said, is necessary to control the macroeconomic component, mainly currency and key interest rate (BI Rate). Another policy is to ensure that export proceeds go to the state's pocket.
Sasmito supports the government's decision to mandate exporters with the use of letters of credit (L/C). By doing so, he said, export revenues will flow in and indirectly strengthen the rupiah.
Meanwhile, Coordinating Minister for Economic Affairs Sofyan Djalil had said that an inflation of 0.17 percent is still within normal limits.
TRI ARTINING PUTRI | M. AZHAR (PDAT) | ADITYA BUDIMAN