"We hope the inflation rate would be kept at four percent in accordance with the assumption in the 2017 state budget," the minister said.
Jakarta (ANTARA News) - Finance Minister Sri Mulyani Indrawati still expects the 2017 inflation rate to stay within the governments target range of four percent.

"We hope the inflation rate would be kept at four percent in accordance with the assumption in the 2017 state budget," she noted here on Monday.

Indrawati said the government will make every effort to maintain the inflation rate until the end of this year by ensuring economic stability in the second semester of 2017.

The government believes it can maintain economic stability, as it has implemented various measures to maintain the supply side by controlling the prices of food items, she said.

The government has committed to refraining from adjusting the tariffs of liquefied petroleum gas and fuel oils until September 2017 and not increasing the electricity tariff until the end of this year, she remarked.

"We hope that inflationary pressure from the cost side would weaken or ease," she noted.

In addition, public demand will decline in the wake of the fasting month of Ramadhan and the subsequent Lebaran festivities, thereby easing pressure on the second semester inflation rate, she stated.

"Pressure from the demand side will also ease, so we hope that in the second semester, the inflation outlook would be relatively better," she said.

The government will always coordinate with Bank Indonesia, the central bank, to keep core inflation and inflation caused by overseas price changes and exchange rate, or imported inflation, under check, she noted.

Indonesias inflation rate rose by 0.69 percent in June 2017, fueled by a rise in the electricity tariffs, air tickets, and intercity transport fares, the Central Bureau of Statistics (BPS) stated.

The increase in tariffs of the three components brought the inflation rate from administered prices in June 2017 to 2.1 percent, BPS Chief Suhariyanto said on Monday.

However, the inflation rate from volatile food prices remained under control at 0.65 percent due to the governments efforts to stabilize food prices during Ramadhan and Lebaran, he remarked.

"Food prices were relatively under control. Similar to the previous year, no food price hike was recorded in this period," he noted.

The June 2017 inflation rate brought the January-June 2017 calendar inflation rate to 2.38 percent and year-on-year inflation rate to 4.37 percent.(*)

Editor: Heru Purwanto
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