Improvement in Economic Conditions has Strengthened Rupiah: BI

TEMPO.CO, Jakarta - The improvement in Indonesia`s economic fundamentals has led to the strengthening of the Rupiah exchange rate against the U.S. dollar, Bank Indonesia (BI) Deputy Governor, Perry Warjiyo, stated.

"There is a positive sentiment at home. Economic growth is higher and the inflation is lower than expected," said Perry at the office of the Chief Economic Minister here on Thursday.

He said market players are now giving a positive response to positive economic conditions, including the performance of the current transaction deficit, which has narrowed due to low imports.

Besides that, he said, positive news has also emerged as the government has accelerated the realization of the expenditure budget since the beginning of the year, which is useful for the development of infrastructure.

"I think this will be good for our economy. It supports stability and is better for our growth," stated Perry.

The other factor driving the strengthening of the Rupiahs value against the greenback is an external one, namely the certainty that the U.S. Federal Reserve will not make an interest rate adjustment in the near future.

"This is also due to the fact the United States current economic growth is not yet as strong as what was expected earlier," Perry noted.

The Rupiah value in interbank transactions in Jakarta on Thursday morning increased by 76 points to Rp13,378 against US$1, rising from a previous position of Rp13,454 per US$1.

"The Rupiah currencys value is again in the positive range against the U.S. dollar. The strengthening of the Rupiah indicates that the domestic economy is still strong," economist Rangga Cipta from Samuel Sekuritas said.

ANTARA