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RI spends $4.6b of forex reserves to pay debt, stabilize rupiah
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A clerk counts United States dollar banknotes on May 22, 2024 at a money changer in Jakarta. (Antara/Rivan Awal Lingga)
I
ndonesia shaved US$4.6 billion off its foreign exchange (forex) reserves in April as the government serviced foreign debts and the central bank intervened in the market to stabilize the rupiah’s exchange rate amid the tariff turmoil.
A press statement issued by Bank Indonesia (BI) on Thursday details that the forex reserves by the end of April amounted to $152.5 billion, down from $157.1 billion a month prior.
“That development was influenced, among other things, by the government's external debt payments and rupiah stabilization policy as Bank Indonesia's response to increasing global financial market uncertainty,” BI spokesman Ramdan Denny Prakoso said in the statement.
The assets held at the end of last month were equivalent to 6.4 months of imports, “which is well above the international reserve adequacy standard of around three months of imports”, Denny explained.
He went on to say that the monetary authority deemed the current level of reserve assets “adequate” to support the resilience of the external sector while “buttressing macroeconomic and financial system stability”.
Denny said investor confidence had been maintained thanks to the export outlook, accompanied by sustained capital and financial account surpluses alongside “positive investor perception concerning the promising national economic outlook and attractive investment returns”.
The last time the country’s reserves dropped close to that amount within a month was exactly one year ago, when the reserves dropped by $4.2 billion to $136.2 billion in April 2024 from $140.4 billion in the preceding month.
