"At present, price increases happen not only with onions."
Jakarta (ANTARA News) - Economic observer Aviliani said the government should maintain food price stability if it wanted to achieve its inflation target in the state budget at 4.9 percent.

"The high inflation in March indicated that food prices contributed a lot to the inflation rate. Therefore, food price stability needed to be maintained," Aviliani said here on Monday.

She said the government`s plan to raise basic power tariff in the near future would also help drive up inflation in the coming months.

Aviliani who obtained her doctorate degree on business and management at the Bogor-based Institute of Agriculture (IPB), predicted that inflation would reach six percent if the government failed to control food prices.

"At present, price increases happen not only with onions. The price of red chili also has increased. The ministry of agriculture should control prices so that they would not rise too high. Moreover, the economic conditions are quite sensitive in the face of next year`s general elections," she said.

Aviliani predicted that the power tariff rate which had been decided by the government and the House of Representatives (DPR) would contribute 0.5 percent to the inflation. If the prices of food commodities were not taken under control, it would contribute 1 percent to the inflation, she said.

"The increase of power tariff could no longer be avoided so that the one that should be controlled is the prices of food commodities. If the government also failed to control food prices, the poverty rate will also increase," the economic observer said.

Previously, Head of the Central Board of Statistics (BPS) Suryamin said the inflation rate in March stood at 0.63 percent, a relatively high rate in the past five years.

"The inflation rate in March is still relatively high if compared with the inflation rate in the same month in the past five years," Suryamin said.

He said that the highest March inflation was recorded at 0.95 percent in 2008. But the 0.63 percent inflation in March 2013 was high, yet it is still lower than that in the previous month, namely 0.75 percent in February 2013.

The BPS chairman said that the biggest contributor to the March 2013 inflation was the fluctuation of price components which contributed 0.52 percent, or in total 2.44 percent.

"The causes of the inflation increase was already detected in February, namely increases in the prices of a number of commodities," he said.

He said that the January-March calender year inflation was recorded at 2.48 percent and inflation on year-on-year stood at 5.9 percent.

The inflation of the main component was 0.13 percent and year-on-year inflation was 4.12 percent.
(Uu.A014/H-YH)

Editor: Priyambodo RH
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