Subsidized Fuel Limitation Affects August Inflation

Jakarta, Sept 1 (Antara) - The government`s policy to limit the use of subsidized fuels affected the inflation rate in August 2014 which reached 0.47 percent, Bank Indonesia Deputy Governor Perry Warjiyo said. "Admittedly, the policy to limit the use of subsidized fuels has several impacts. In the third week, the impacts appeared to be higher," he said after a meeting with the Budget Body of the House of Representatives (DPR) on Monday. The results of a price monitoring survey showed the inflation rate stood at 0.2 percent until the second week of August. But in the third and fourth weeks, there was a significant increase in transport fares and fish prices, he said. After all, the August 2014 inflation rate was relatively lower than the average inflation rate in the same month over the past 10 years, he said. "Overall, the August 2014 inflation was still lower than the historical average of around 5.7 percent, year-on-year," he said. Perry was convinced the inflation rate throughout 2014 would remain manageable. Based on the cycle, inflation rates would be relatively low in September and October and would increase again in November and December. "So we still come to the conclusion that the month-on-month or year-on-year inflation rate will still be kept in check," he said. The Central Statistics Agency (BPS) announced earlier in the day the August 2014 inflation rate eased to 0.47 percent from 1.12 percent in the same month last year. The monthly inflation rate brought the calender inflation rate to 3.42 percent and the year-on-year inflation rate to 3.99 percent. The agency said the August 2014 inflation rate was fueled by a 0.36 percent rise in foodstuff prices, a 0.52 percent increase in processed food, beverage, tobacco and cigarette prices, and a 0.73 percent in housing, water, electricity, gas and fuel prices. Meanwhile, the increases in cloth prices contributed 0.23 percent, healthcare cost 0.33 percent, and tuition fees, recreation and sports 1.58 percent to the August 2014 inflation.