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Rice and chili prices contribute to 0.37 percent February inflation: BPS

Jakarta Globe - March 1, 2024

Alfi Dinilhaq, Jakarta – The Central Statistics Agency (BPS) reported a 0.37 percent monthly inflation in February. Year-on-year inflation stands at 2.75 percent, and calendar-year inflation is at 0.41 percent, primarily driven by a notable increase in food prices, particularly rice and red chili.

M. Habibullah, Deputy for Statistical Production at BPS, explained during a press conference on Friday that the expenditure group contributing the most to inflation is the food, beverages, and tobacco group. This group experienced a 1 percent inflation, contributing 0.29 percent to the overall inflation in February 2024. Key contributors to monthly inflation include rice with a 0.21 percent contribution, red chili with 0.09 percent, chicken eggs with 0.04 percent, and chicken meat with 0.02 percent.

Conversely, items predominantly contributing to deflation include shallots at 0.04 percent, tomatoes at 0.03 percent, and bird's eye chilies with a 0.02 percent contribution.

Among the 38 provinces, 26 experienced inflation, while the remaining 12 faced deflation. West Sumatra Province recorded the highest inflation at 1.17 percent, while Maluku Province reported the deepest deflation at 1.19 percent.

Breaking down the components, inflation in February 2024 was observed across all components, with volatile food prices leading the surge. The volatile food price component experienced a 1.53 percent inflation, contributing 0.25 percent to February's overall inflation.

"The dominant commodities contributing to inflation in the volatile food price component are rice, red chili, chicken eggs, chicken meat, and potatoes," Habibullah said.

Meanwhile, the dominant commodities contributing to inflation in the government-regulated price component are machine-rolled clove cigarettes and air transportation tariffs.

In a press conference last week, Finance Minister Sri Mulyani Indrawati expressed concern about the 7.7 percent year-to-date increase in rice prices and its potential impact on the inflation rate. The government aims to maintain inflation within the range of 2.5 percent, plus or minus one percent.

Based on Bank Indonesia's observations, rice prices varied from Rp 12,947 in West Nusa Tenggara (NTB) to the highest at Rp 18,800 in Central Kalimantan in February.

Source: https://jakartaglobe.id/business/rice-and-chili-prices-contribute-to-037-percent-february-inflation-bp