The impact of fluctuation of the price of food commodity on inflation in North Sumatera Province

Abstract

Inflation in North Sumatera Province fluctuates annually. The contribution of foodstuffs to inflation in North Sumatera Province shows a high contribution. This study analyzes the fluctuations in commodity prices for rice, red chilies, onion and garlic. The data used are monthly time series data in the form of Consumer Price Index (CPI) and food commodity prices in the period January 2000 to December 2017. The purpose of this study was to analyze the impact of fluctuations in food commodity prices (rice, red chilies, onion, and garlic) to inflation in North Sumatera Province. The data analysis method used in this research is robust regression. The results of this study indicate that the commodities of rice, red chilies, and onion had positive and significant impact on inflation in North Sumatera Province, while garlic commodity did not have any significant impact on inflation in North Sumatera Province.