Inflation Believed To Rise Ahead Of Christmas And New Years Due To Increased Consumption

Illustration (Photo: Doc. Ministry of Finance)

JAKARTA - The government through the Head of the Fiscal Policy Agency (BKF) of the Ministry of Finance Febrio Kacaribu said that inflation still has the potential to gradually strengthen ahead of the Christmas and New Year (Nataru) momentum which is usually followed by increased consumption.

"However, the potential for higher inflationary pressure is expected to be relatively minimal in line with the policy of eliminating the Nataru holiday and the implementation of the PPKM tightening policy," he said in an official statement, Friday, December 3.

According to Febrio, the rising inflation in November was mainly contributed by the volatile food and beverage component.

In his notes, monthly (month-to-month/mtm) inflation was 0.37 percent in November 2021, so that the cumulative inflation from January to November reached 1.30 percent. Meanwhile, core inflation continued an upward trend, reaching the range of 1.44 percent year-on-year (yoy), up from October's figure of 1.33 percent (yoy).

"Prices pressure at the producer level is expected to continue to consumer prices, although it is still limited," he said.

On the other hand, the increase in inflation was also driven by the increase in air transportation fares in line with the increasing mobility of people between regions. In addition, the increase was also influenced by the impact of the increase in the price of filter kretek cigarettes.

“The government continues to be consistent in supporting the maintenance of domestic prices so that the recovery momentum can continue to be accelerated. In addition, the government will also set a policy to anticipate a spike in mobility by removing the year-end collective leave and increasing the PPKM level in Nataru again," closed Febrio.