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Forex reserves high at end of 2023 as govt took on more foreign debt
Bank Indonesia said that December's forex reserves remained sufficient to support 6.5 months of imports and payments of the government's short-term debt.
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Dollar haven: A teller counts United States dollar banknotes on Oct. 4, 2023, at a money changer in Jakarta. As of October, the rupiah had depreciated 8 percent against the US dollar. (Antara/Muhammad Adimaja)
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ndonesia’s foreign exchange (forex) reserves in December closed at the highest level of last year, bouncing back after months of decline, particularly between March and October.
Bank Indonesia (BI) spokesperson Erwin Haryono said reserves rose to US$146.4 billion last December from $138.1 billion in the previous month.
The increase can be attributed to increasing state revenue and a rise in foreign debt taken by the government last year.
The central bank said that the latest figure remained sufficient to support 6.5 months of imports and payments of the government's short-term debt, double the international adequacy standard to cover three months of imports.
"The reserves will support resilience to external factors and will maintain macroeconomic and financial system stability. Going forward, BI's forex reserves will remain sufficient, supported by stability and maintained economic prospects," Erwin wrote in a statement on Monday.
The forex reserves hit their peak of $145.2 billion last March before tumbling to $133.1 billion in October because of the government’s need to pay off foreign debt and the central bank’s effort to stabilize the rupiah exchange rate.
Last year, the rupiah was pressured by the United States dollar as the US Federal Reserve hiked interest rates to a peak of between 5.25 and 5.5 percent last August, with the central bank signaling that it would maintain the level for a long time.
