The 2022 inflation rate is forecast to reach 3.5–4.5 percent, higher than the early projection in the state budget. The (global commodity price) hike will have the potential to raise domestic commodity prices.
Jakarta (ANTARA) - The Finance Ministry has forecast that Indonesia's inflation rate will be in the range of 3.5–4.5 percent year on year this year, well above the target of 3 percent set in the 2022 state budget.



The higher-than-targeted inflation rate will be triggered by the soaring prices of global commodities, particularly energy and food, Chief of the Fiscal Policy Board of the Finance Ministry Febrio Kacaribu explained at an online press conference on the state budget on Wednesday.



"The 2022 inflation rate is forecast to reach 3.5–4.5 percent, higher than the early projection in the state budget. The (global commodity price) hike will have the potential to raise domestic commodity prices,” he said.


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The government will remain alert to the latest price developments and stabilize food prices so that they do not have a direct impact on consumers, he added.



In the midst of global uncertainty, the government will use the state budget as an instrument to protect the people's purchasing power and maintain the momentum of national economic recovery, he said.


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"The state budget serves as a shock absorber. We want to maintain the people's purchasing power as well as the momentum of economic recovery. In this context, (the effort) to maintain the people's purchasing power is reflected by the relatively controllable inflation rate compared to that in other countries," he added.



Earlier, Statistics Indonesia (BPS) said inflation reached 0.61 percent in June 2022, bringing the calendar year inflation to 3.19 percent.



The June 2022 inflation was recorded at 4.35 percent year on year, up from 3.55 percent a month earlier. It was also the highest inflation recorded since June 2017.


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Translator: Sanya Dinda S, Suharto
Editor: Fardah Assegaf
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