Bank Indonesia (BI) will not offer 3-month BI certificates (SBI) at auction on Wednesday to shift excess liquidity to longer-term investments, an official said.
BI spokesman Difi A. Johansyah said in a text message that the central bank would instead offer 6- and 9-month SBI papers as well as 1- and 2-month term deposits at BI auction in Wednesday.
"The use of 3-month SBIs will be situational depending on conditions and expectations toward liquidity," Difi added.
On the same day, BI released data showing that foreign holdings in Indonesia’s stock and debt markets decreased by Rp 1.3 trillion (US$144 million) as of the first week of November.
Difi said the outflows were a temporary phenomenon due to await-and-see attitude from foreign investors after the US Federal Reserve System announced plans for quantitative easing".
The Federal Reserve announced that it would shore up the US economic recovery through the phased purchase of $600 billion in long-term Treasury securities until the middle of next year.
The move will increase the money supply to promote lending and liquidity and is expected to result increased capital inflows to emerging markets that offer higher returns, as near-zero interest rates have failed to boost economic growth in the world’s largest economy.(est)
| 
|
|
|
|
|
|
|