Indonesia’s foreign exchange reserves fell to US$128.06 billion in February from $131.98 billion in the previous month, as the central bank moves to stabilize the rupiah’s volatility and pay off the government’s foreign debts.

Bank Indonesia reported that the amount was enough to finance 8.1 months of imports and payments for the government’s external debt, assuring that it far exceeds the international adequacy standards of around three months of imports.

“The decline in foreign exchange reserves was also influenced by the bank’s declining foreign currency term deposits in the central bank, in line with residents’ need to repay their foreign currency liabilities,” read a BI statement released on Wednesday.

Going forward, BI believes that the country’s foreign exchange reserves would be enough to withstand external shocks, as the country is showing positive economic growth and exports.

It will also receive additional foreign exchange reserves from the government's global sukuk issuance of $3 billion in March. This could be used to support macroeconomic stability and financial stability. (bbn)