TEMPO.CO, Denpasar - Finance Minister Sri Mulyani Indrawati said that the unmet oil lifting target, and the declining volume, adds pressure to the rupiah exchange rate. The two factors, she said, makes it difficult for the rupiah to rebound.
Today, Sept. 19, Bank Indonesia's middle rate sees the rupiah trades for 14,896 per US dollar, above the 2018 state budget assumption, which the government pegged at Rp13,400 a dollar.
Sri Mulyani said that the domestic macroeconomics has nothing to do with the rupiah correction, as Indonesia's economy continues to strengthen, as seen by banks' increasing credit disbursement, a high capital adequacy ratio, as well as the low ratio of bad loans (NPL).
Read: Rupiah Slips Further Closes at 14,875 per US Dollar
“However, import demand surges and oil output is showing no improvements," Sri said in Bali, September 18.
The minister said that Indonesia's lifting volume has dropped 35 percent compared to 12 years ago, when every day the amount of oil output could reach a million barrels.
Coupled with increasing imports—as well as the US' aggressive interest rate and tight liquidity policies, they become factors that are dragging the rupiah down.
The government has reacted by implementing a number of fiscal and monetary policies that can boost exports and attract investors.
Bisnis.com
