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Friday March 2, 2012

Indonesia to modify GDP forecast       

JAKARTA: Indonesia plans to modify its GDP growth forecast to 6.5%-6.7% in the proposed revision of the 2012 state budget, versus a current 6.7% growth target, the chief economics minister said yesterday.

Minister Hatta Rajasa also told reporters the government would revise this year's inflation target upwards to 6%-7% from 5.3% in the current budget, while raising the benchmark Indonesian crude price (ICP) to around US$105 a barrel from US$90.

South-East Asia's largest economy always revises its state budget, but is doing so sooner than usual this year because state coffers are under pressure from rising global oil prices.

The government plans to raise subsidised fuel prices by a third or link them to floating market rates

“We see global growth is relatively trending down. We will manage food prices so they will not be too volatile,” said Rajasa after a cabinet meeting with President Susilo Bambang Yudhoyono.

Finance Minister Agus Martowardojo, speaking separately, gave slightly different figures and said the GDP growth forecast would be revised down to 6.5% and the ICP raised to above US$100 a barrel. Reuters

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