Rupiah devaluation not needed<\/p>\n
Much apprehension has been created in the past few days by
\nmaneuvers made by foreign exchange speculators. After having
\nupset the Thai, Philippine and Malaysian currencies those
\nspeculators have also tried to pressure our monetary system. As a
\nconsequence, the Thai baht and Philippine peso had to be
\ndevalued, although in de facto terms only. As for the Malaysian
\nringgit, its rate dropped sharply, although not enough to call
\nfor a devaluation.<\/p>\n
It has been a relief to see that the same did not occur in
\nIndonesia. This was due to the preventive measures taken by the
\nIndonesian monetary authority, led by Bank Indonesia Governor
\nSoedradjad Djiwandono and Finance Minister Mar'ie Muhammad.<\/p>\n
Another factor that enabled the rupiah to withstand the
\npressure is the fact that the Indonesian economy is fundamentally
\nsound. Our export growth, although slowing down, has been
\npositive. Our trade balance shows a surplus of six percent to
\nseven percent. Our foreign exchange reserves total US$23 billion,
\nincluding $2 billion in standby loans, which is enough to pay for
\nour imports for the next five and a half months. In other words,
\nIndonesia was better prepared than its neighbors to anticipate
\nthe speculators' attacks.<\/p>\n
A currency devaluation is not the best cure in this case,
\nalthough it might offer a swift way to overcome the problem. The
\nproblem is that a devaluation always brings more problems in the
\nform of price increases and rising inflation. This would
\ncertainly be no proper way to anticipate speculators' actions.<\/p>\n
-- Republika, Jakarta<\/p>", "url": "https:\/\/jawawa.id\/newsitem\/rupiah-devaluation-not-needed-1447893297", "image": "" }, "sponsor": "Okusi Associates", "sponsor_url": "https:\/\/okusiassociates.com" }