REPUBLIKA.CO.ID, JAKARTA -- Bank Indonesia Deputy Governor Hendar forecast here on Thursday that the inflation rate would return to its normal pattern in February 2015.

"The month-to-month inflation will be back to normalcy in February following the government's recent decision to raise the price of subsidized fuel oils," he stated.

The inflation rose in November to 1.50 percent (month-to-month), up by 0.47 percent from October's rate. However, it is below Bank Indonesia's forecast, he remarked.

The hike in inflation was due to an inflation increase in the administered price group and volatile foods group. Annually, the consumer price index (IHK) inflation in November was recorded at 6.23 percent, he remarked.

The administered price inflation has risen mainly due to the increase in the prices of subsidized oils, land transportation service fares, and electricity tariff.

The hike in core inflation is in line with expectations reaching 0.4 percent (month-to-month) or 4.21 percent (year-on-year), as a result of the hike in the price of transportation services following the increase in fuel prices.

Hendar said the government's decision to adjust the price of subsidized oils was expected to increase inflation, though it was believed to last for only three months after the fuel price hike, prior to finally returning to a normal pattern.

"Two weeks ago, the government hiked the price of subsidized oils. In the short term, it would indeed push inflation to a higher level but in the long term, it would bring a lot of positive things. It could reduce oil imports while more funds could be reallocated to infrastructure development to push economic growth," he added.

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