ECONOMIST : 2009 INFLATION RATE MAY REACH 8 PCT

Pontianak, W Kalimantan, Aug 24 (ANTARA) - The country's inflation rate in 2009 may reach 8 percent due to an increase in demand for goods and services at the end of the year, an economic observer said.

"This figure is higher than the inflation rate assumed in the state budget which was 6.5 percent," Evi Asmayadi, economic observer at Tanjungpura University said here on Monday.

She said the on-going fasting month and the upcoming post-fasting month festivities would be among the factors that would trigger the high demand for goods and services.

"The rising demand for basic necessaries, the condition of goods distribution and cultural factors will contribute to the higher inflation rate as well," Asmayadi said.

She estimated the August and September inflation rates would reach 2.2 percent, the highest monthly level in 2009.

"The inflation rate will drop in October and November but rebound in December," she said.

The economic observer said the government should take steps to guarantee the smooth distribution of goods such as cooking oil and other basic necessaries and at the same time maintain the stability of food prices.

"These efforts should be made to offset the year-on-year inflation rate," she said.

According to the Central Board of Statistics (BPS), the 2009 inflation rate was targeted at 4 percent while the assumed inflation rate in the state budget was 6.5 percent.

In 2008, the inflation rate was 11.06 percent and in 2007 it was 6.59 percent.