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Are we finally zeroing in on rupiah redenomination?
The central bank had long been ready to slash three zeros off the national currency and was simply waiting for the right time to do, its governor said.
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A stock photo shows the range of banknotes printed in the national currency, from Rp 1,000 to Rp 100,000. (Shutterstock/devmograph)
B
ank Indonesia (BI) has said that the implementation of a long-ready plan to slash some zeros off the national currency is waiting for “the appropriate time”.
“Regarding redenomination, we have been ready for a while,” BI Governor Perry Warjiyo affirmed at a press conference on Thursday, noting that this readiness included the design and introductory strategy for the new currency.
The smallest rupiah banknote currently in circulation is Rp 1,000, while the largest is Rp 100,000.
Perry added that the right time for redenomination must meet the three key preconditions of strong macroeconomic environment, monetary and financial system stability and conducive political climate.
While he acknowledged the national economy’s positive performance, he emphasized that "it’s good, of course, to ascertain the right moment [...], because the ramifications from global [developments]” still hold sway.
Read also: BI keeps rates unchanged despite hawkish Fed comments
The discussion on rupiah redenomination has been going on for decades. The Finance Ministry provided the strongest indication yet that three zeros might be removed from the national currency when it submitted the currency redenomination bill in 2017.
