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Jokowi upbeat about economic fundamentals
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President Joko "Jokowi" Widodo (Antara/Rosa Panggabean)
P
resident Joko “Jokowi” Widodo has expressed his faith in Indonesia’s macroeconomic fundamentals, saying they remained sound amid increasing external pressure on the rupiah.
“I believe that our [macroeconomic] fundamentals are good. We are recording growth, our inflation is also under control, and our exports are staying strong,” Jokowi said in Jakarta on Monday.
He attributed the current rupiah depreciation to economic developments in the United States, including the expectation that the Federal Reserve will increase the federal funds rate.
He stressed that depreciation against the dollar also affected other currencies across the world.
Jokowi reiterated that the government would not intervene in monetary policy, which was under the authority of Bank Indonesia.
BI Governor Agus Martowardojo had previously said that the central bank kept open the option of increasing its reference rate – the BI seven days reverse repo rate – should the rupiah continue to weaken.
Agus emphasized that an increase in the reference rate, which currently stands at 4.25 percent, would be based on the latest data available to the central bank.
The rupiah traded at Rp 13.877 per US dollar on Monday, according to the Jakarta Interbank Spot Dollar Rate (JISDOR), barely changed from Rp 13.879 recorded a day earlier.
As of April 26, BI data revealed that the rupiah had depreciated by 0.88 percent month-to-date (mtd), thereby faring better than other currencies in the region, such as Thailand’s baht and the Malaysian ringgit, which depreciated by 1.12 percent and 1.24 percent, respectively. (bbn)
