Indonesia inflation hits 3.97pc

JAKARTA: Inflation in Indonesia rose to almost four percent last month due to the increased cost of food and spices, the government said on Monday.

The increase came despite a controversial plan to slash fuel subsidies this month failing to get off the ground.

The consumer price index (CPI) rose to 3.97 percent in March from a year earlier, from 3.56 percent in February, the Central Statistics Agency said.

"An increase in some food prices such as chilli peppers caused the rise in inflation," said the agency's head Suryamin, who goes by one name.

"There was a shortage of chillies in many provinces," he told reporters, in a country where peppers and spices go into nearly every recipe.

The March CPI rose 0.07 percent on-month compared with 0.05 percent in February, the agency said.

Core inflation, which excludes volatile food and energy prices, hit 4.25 percent year-on-year in March, slightly lower than 4.31 percent in February.

Suryamin said a failed government plan to slash hefty fuel subsidies this month did not drive last month's inflation, though local media reported fuel hoarding in anticipation of price increases.

Indonesia's on Saturday rejected a plan to raise the price of subsidised fuel by a third, instead voting in a law that would allow future hikes if global oil prices rise further.