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View all search resultsThe growing trend of de-dollarization, especially on the heels of the MOU to promote local currency use signed last month between the central banks of Indonesia and China as well as the global turmoil following Trump's tariff policy flip-flop, presents a strategic opportunity for Indonesia to strengthen its fiscal and monetary policies.
Despite the general pullback trend in sustainable finance and early signs of saturation, more flexible instruments like SLLs present better resilience as the broader energy transition investment landscape moves toward selectivity, and this juncture of strategic adjustment is where Indonesian banks come in.
A weak rupiah exchange rate limits Bank Indonesia’s scope for further monetary policy easing at this time, but the central bank is pinning its hopes on the appeal of Indonesian stocks and bonds to lift the currency’s worth.
Falling interest rates in developed economies should see more portfolio investment flow back into emerging markets like Indonesia, but some sectors stand to benefit more than others, and caution is warranted as fears of a US recession continue to haunt global markets.
While the ongoing global monetary easing is expected to have a positive impact on Indonesia's economy, stakeholders still need to remain mindful of certain risks and take preventive measure to maintain rupiah stability, enhance domestic liquidity and control inflation.
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