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Indonesia’s forex reserves rise to near record-high in June
Indonesia’s foreign exchange (forex) reserves increased to US$131.7 billion in June following the government’s move to issue global sukuk (sharia compliant bonds) in the month.
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The logo of Bank Indonesia (BI) marks the central bank’s gate on Jl. Thamrin in Central Jakarta. Indonesia’s foreign exchange (forex) reserves increased to US$131.7 billion in June following the government’s move to issue global sukuk (sharia compliant bonds) in the month, BI reported on Tuesday. (The Jakarta Post/Rafaela Chandra)
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ndonesia’s foreign exchange (forex) reserves increased to US$131.7 billion in June following the government’s move to issue global sukuk (sharia compliant bonds) in the month, Bank Indonesia (BI) announced Tuesday.
The current reserves level, an increase of $1.2 billion from May’s level and the highest reserves level since January before the coronavirus pandemic upended the country’s economy, is estimated to be sufficient to support 8.1 months of imports and payment for the government’s short-term debts.
“BI is of the view that the foreign exchange reserves are adequate, supported by stability and a positive outlook for the economy,” the central bank said in a statement, adding that the rise in forex reserves was due to the government’s global sukuk issuance last month.
Indonesia has raised US$2.5 billion from a three-tranche global sukuk (sharia-compliant bond) offering on June 17, the issuance of which aims to help the government fund the battle against the coronavirus pandemic.
The sukuk were offered on the Singapore stock exchange and NASDAQ Dubai in the United Arab Emirates. The 10-year maturity sukuk brought in $1 billion while the five-year and 30-year maturities raised $750 million each.
The government is facing a daunting task to raise Rp 900.4 trillion worth of sovereign debt papers in the second half of the year to cover for budget deficit of 6.34 percent of gross domestic product (GDP) and repay its debts, after raising Rp 630.5 trillion worth of debt papers in the first half.
The government had just raised 100 billion yen ($930 million) from the issuance of five-tranche samurai bonds on Thursday as part of broader efforts to raise money amid the pandemic.
It had also unveiled a bond sale program totaling Rp 574.5 trillion with the central bank as part of the “burden sharing” scheme aimed to ease the government’s debt burden.
