Jakarta – The Central Statistics Agency (BPS) reported deflation in June 2024. However, the threat of food price inflation still looms, especially considering external factors such as climate change and the weakening of the rupiah exchange rate.
“We need to be aware that climate change and La Nina this year have the potential to increase food prices,” said Banjaran Surya Indrastomo, Economist of Bank Syariah Indonesia (BSI), in an official statement Tuesday, July 2.
BPS agreed with this statement, which said that several food commodities, such as cayenne pepper, red chilli, and rice, were still experiencing inflation. Increasing rice prices at various levels, from milling to retail, is a danger signal. In addition, the price of imported food such as garlic and flour has also soared due to the weakening rupiah.
“This condition must be watched by the government. Fluctuations in the rupiah exchange rate can exacerbate food inflation,” Surya explained.
Previously, at the National Coordination Meeting on Inflation Control 2024, Coordinating Minister for the Economy Airlangga Hartarto said that although the government is optimistic that inflation this year can be kept in the range of 1.5 to 3.5 per cent, vigilance must still be increased. Climate change, a weak rupiah, and high imported food prices could become a time bomb for inflation. (Hartatik)
