BI Blames US Economic Policy for Rupiah Volatility
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Kamis, 1 Januari 1970 07:00 WIB
TEMPO.CO, Jakarta - Bank Indonesia (BI) governor Agus Martowardojo said the rupiah volatility is mainly the direct effect of the global economic situations, particularly the United States expansive fiscal policies and its central bank`s stance to raise interest rates.
Agus said the US’ policy affects not only Indonesia and the rupiah, but also other nations and their currencies.
“BI is consistently and carefully responding to the rupiah’s dynamics to ensure that our macroeconomics and financial stabilities remain safe,” he said in a written statement on Wednesday, Mar. 7.
Agus is confident that Indonesia’s fundamentals and the coordination between the central bank and the government will be able to withstand the external pressure--not letting it affect the state’s economy for too long.
He also said that BI’s regulations, such as the hedging mandate for foreign loans and the obligation to use rupiah as a payment instrument have lowered the excessive demand for foreign currencies.
