Jakarta. Bank Indonesia Governor Perry Warjiyo expressed confidence on Wednesday that the exchange rate of the rupiah will gradually strengthen and fall below the 16,000 level against the US dollar.
Decisive measures taken by the country’s monetary authorities have proven effective in easing the weakening of the rupiah from 16,300 to around 16,000 against the dollar recently.
“We are focused on strengthening the rupiah and maintaining it below 16,000 per dollar,” Perry said at a news conference in Jakarta.
Perry outlined several key factors expected to contribute to a stronger rupiah amid global currency volatility.
Firstly, he cited a more attractive return on investment following the central bank’s recent 25-point increase in the benchmark interest rate to 6.25 percent.
Secondly, Perry highlighted the improving credit default swap (CDS) index in Indonesia, which serves as a reference for foreign investors.
“When comparing US treasury bonds with Indonesian government bonds, foreign investors use the CDS index as a benchmark,” Perry explained.
Another contributing factor is the positive outlook for the Indonesian economy, projected to grow by over 5 percent in the second quarter.
Furthermore, Perry mentioned the central bank’s commitment to implementing measures aimed at stabilizing the rupiah exchange rate.
Tags: Keywords:
Tags: Governor Confident Rupiah Strengthen Dollar
