"The prices of strategic foods, particularly chilies and shallot have caused high inflationary pressure," BI Governor Agus Martowardojo said.Jakarta (ANTARA News) - The inflation rate in the third week of November 2016 will reach 0.39 percent, fueled by pressure from the prices of strategic foods, Bank Indonesia (BI) has predicted.
"The prices of strategic foods, particularly chilies and shallot have caused high inflationary pressure," BI Governor Agus Martowardojo said here Friday.
The rising prices of strategic foods were caused by general conditions, namely the La Nina weather pattern which has affected food productivity, he said.
Yellow virus had also caused a chili harvest failure, leading to a limited supply of chilies to the market.
BI will always coordinate with the central and regional governments to prevent the inflation rate from rising further, he said.
The central bank has predicted that the inflation rate for all of 2016 will stay between 3 and 3.2 percent year on year, less than the rate of 3.35 percent in 2015.
Earlier, Coordinating Minister for Economic Affairs Darmin Nasution had projected the inflation rate at the end of this year to be less than 3.0 percent as the inflation rate in the calendar year from January to October 2016 was recorded at 2.11 percent.
The low inflation rate in the year up to October 2016 reflected the governments successful efforts to curb the prices of food commodities by ensuring their supplies, Darmin said.
The success was evident from a group of foodstuffs which registered deflation as their prices fell. However, the prices of foodstuffs contributed 0.14 percent to the inflation rate in October 2016.(*)
Editor: Heru Purwanto
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