Jika Tak Naikkan Suku Bunga, Ini Amunisi BI Tahan Pelemahan Rupiah

Summary

The transcript discusses Indonesia's central bank policy on interest rates and the potential for maintaining current levels. It suggests that if the bank keeps rates steady, it could positively impact the financial industry by avoiding cost increases. Concerns about the weakening Rupiah are addressed, with the speaker noting that it's within reasonable limits compared to other currencies and not causing significant imported inflation. Various instruments are mentioned that the bank could use to stabilize the Rupiah, including interventions in the forex market and issuing SBI. The speaker believes that the central bank has ample tools and reserves to manage currency stability without aggressively raising interest rates.

Takeaways

• 📉 The market response would be more positive if Bank Indonesia maintains the current interest rate, as it would mean the cost of finance for industries in Indonesia would not continue to rise.
• 💹 Investors are concerned that higher costs could pressure the performance of the financial industry, reducing net interest margins and credit growth due to tighter liquidity.
• 💨 The current weakening of the Rupiah is considered within reasonable limits compared to other currencies, such as the Japanese Yen and ASEAN countries' currencies like the Malaysian Ringgit.
• 🛑 The weakening of the Rupiah is not expected to cause significant inflationary pressure or imported inflation, as the currencies of trading partners are also depreciating against the US dollar.
• 🛡 Bank Indonesia has other instruments to stabilize the Rupiah's depreciation, such as triple interventions, issuing SBI (State Bonds), and offering foreign currency in the Forex market and derivatives.
• 💰 Bank Indonesia has been actively issuing SBI since September, successfully absorbing liquidity and attracting foreign capital, which can be used for currency interventions.
• 🔄 The possibility of raising interest rates might be a last resort if the Rupiah's depreciation continues, but for now, it's not deemed necessary to maintain the currency's value.
• 🌐 The duration of the Rupiah's pressure is uncertain and depends on how quickly the US Federal Reserve decides to cut interest rates, affecting global currency trends.
• 🏦 The strength of the 'triple intervention' by Bank Indonesia in maintaining the Rupiah against the US dollar is significant and can continue to be effective.
• 💼 The stability of the Rupiah is more important for supporting domestic credit growth and the overall economy rather than forcing the currency to strengthen against a scarce US dollar.
• 🌟 Indonesia's foreign exchange reserves are substantial and above international standards, providing a strong buffer to maintain the Rupiah's value and volatility.

Q & A

What is the current stance of Bank Indonesia regarding interest rates?

Bank Indonesia is considering maintaining its current interest rate levels to support the financial industry and avoid increasing costs that could put pressure on the performance of financial institutions.

How would the market respond if Bank Indonesia maintains its interest rates?

The market response would likely be positive, as it would indicate that the cost of finance in Indonesia will not continue to rise, alleviating concerns about the financial industry's performance and net interest margins.

What is the current condition of the Indonesian Rupiah compared to other currencies?

The weakening of the Rupiah is within a reasonable range when compared to other currencies such as the Japanese Yen and currencies of other ASEAN countries like the Malaysian Ringgit.

How does the depreciation of the Rupiah affect imported inflation?

The depreciation of the Rupiah is not causing a significant increase in imported inflation because the currencies of trading partners are also depreciating against the US dollar, leading to a decrease in the cost of imported goods.

What measures can Bank Indonesia take to support the Rupiah's value?

Bank Indonesia can use various instruments such as triple interventions, issuing SBI (State Savings Certificates), and offering products in the foreign exchange market and derivatives to attract investors and intervene in the Rupiah's exchange rate.

What is the impact of the US Federal Reserve's interest rate decisions on global currencies, including the Rupiah?

The US Federal Reserve's interest rate decisions have a global impact. If the Fed continues to raise rates, it puts pressure on currencies worldwide. However, when the Fed cuts rates, it can relieve this pressure and potentially strengthen currencies like the Rupiah.

How does the global economic situation affect the Rupiah's value?

The global economic situation, particularly the US Federal Reserve's monetary policy, significantly influences the Rupiah. External factors, such as the scarcity of the US dollar worldwide, also play a role in the Rupiah's depreciation.

What role do Indonesia's foreign exchange reserves play in maintaining the Rupiah's stability?

Indonesia's foreign exchange reserves are a crucial tool for Bank Indonesia to maintain the Rupiah's stability. They provide a buffer against volatility and can be used to intervene in the currency market.

How does Indonesia's trade surplus contribute to its foreign exchange reserves?

Indonesia's consistent trade surplus, which has been positive for over 43 months, contributes to the increase in foreign exchange reserves, thereby strengthening the Rupiah.

What are the potential future scenarios for the Rupiah's value in the next three months?

The Rupiah is expected to be relatively stronger in the next three months compared to its current position, influenced by factors such as the potential for the US Federal Reserve to cut interest rates and the temporary nature of the current depreciation.

How does the scarcity of the US dollar globally affect Indonesia's currency policy?

The global scarcity of the US dollar makes it counterproductive for Indonesia to force the Rupiah to strengthen against the dollar. Instead, maintaining domestic stability and supporting economic growth through credit growth is preferred.