Indonesia: BI remains alert on rupiah exchange rate

  • While the rupiah’s exchange rate has been stable in Apr 18, Bank Indonesia will remain alert as domestic and external factors could cause volatility, said outgoing BI Governor Agus Martowardojo in Jakarta.
  • He said the government usually paid the interest on foreign debt in 2Q18 while the Federal Reserve would also increase the reference rate.
  • “In 1Q18, there was pressure on the current account and the pressure will be [stronger] in 2Q18,” Agus said.
  • BI has recorded a current account deficit in every 2Q because of the payment of foreign debt interest both by the government and private entities, he said, adding that dividend payments also occurred in 2Q.
  • Meanwhile, BI governor-elect Parry Warjiyo, who is now BI deputy governor, said the central bank would be ready to intervene in the market by spending foreign exchange reserves to purchase government paper debt to keep the rupiah’s value stable.

External Link :