TheJakartaPost
Please Update your browser
Your browser is out of date, and may not be compatible with our website. A list of the most popular web browsers can be found below.
Just click on the icons to get to the download page.
Indonesia's fundamentals strong, despite weakening rupiah: Minister
Despite the weakening of the rupiah in recent months, Finance Minister Sri Mulyani Indrawati has stressed that Indonesia’s fundamental economy was strong enough to face global uncertainty.
Change Size
A money changer employee at ITC Kuningan shopping center exchanges United States dollar banknotes on Feb. 28. (Antara/Puspa Perwitasari)
D
espite the weakening of the rupiah in recent months, Finance Minister Sri Mulyani Indrawati has stressed that Indonesia’s fundamental economy was strong enough to face global uncertainty, particularly the United States Federal Reserve’s plan aggressively increase its reference rate.
Some parameters have shown that Indonesia’s macroeconomic condition is currently much better than in 2017, the minister said.
She pointed out that as of February, tax revenue had grown 14.04 percent to Rp 153.5 trillion (US$10.75 billion), compared to Rp 134.6 trillion in the same period last year.
According to the tax office, revenue stood at Rp 124.4 trillion in February 2016.
"Our current-account balance is currently negative 1.7 percent, still lower than 4 percent during the taper tantrum," she said, referring to the time in 2013 when Fed chairman Ben Bernanke hinted at reducing the Fed’s bond-buying program.
Similarly, investors reacted aggressively then, share prices decreased and the yield of long tenor bonds soared as investments moved to short-term government bonds. The rupiah collapse along with the currencies of other emerging countries.
Then-finance minister Chatib Basri responded by cutting the fuel subsidy to ease expenditures. He opened beef and rice imports to tackle inflation.
Meanwhile, Sri Mulyani said the current inflation rate was the lowest in the three years, standing at 3.18 percent yoy in February, compared to 3.83 percent yoy in the same period last year and 4.42 percent yoy in 2015. (bbn)
