BI comfortable with current level of rupiah
BI comfortable with current level of rupiah
The Jakarta Post, Jakarta
Bank Indonesia governor Burhanuddin Abdullah said on Thursday
that the central bank felt comfortable with the current trade
range of the rupiah and expected the currency to stay in the
range for the rest of the year.
"We have a comfort zone of 8,200 and 8,700 per (U.S.) dollar
for the rupiah. As long as it (the rupiah) moves within that
range, I think Bank Indonesia will feel comfortable," Burhanuddin
told reporters in the first remarks in recent months by the
monetary authority about a desirable trading level for the
rupiah.
The rupiah closed the day at 8,375 against the U.S. dollar,
slightly stronger than the Rp 8,385's closing on Wednesday.
Despite various shocks, the local currency has been generally
performing well against the dollar since the start of the year,
thanks to the country's encouraging macro-economics picture here
and the shaky dollar performance.
The rupiah has strengthened by about 7 percent against the
dollar throughout the year.
The government has targeted the rupiah to average 8,500 per
dollar this year.
The latest positive news came only recently when Moody's
Investors Service, an international rating agency, upgraded
Indonesia's sovereign rating to B2 from B3, thanks mainly to the
country's falling public debts and stronger external financial
footing, as shown in the solid foreign reserves, currently at
US$34 billion.
Burhanuddin also said he expected the central bank's benchmark
one-month promissory notes (SBI) interest rate to hover at 8.5
percent by the end of the year on the back of mild inflation.
Currently, the rate stands at an all-time low of 8.59 percent,
far below the 13 percent at the end of last year.
Inflation, as reported by the Central Statistics Agency (BPS),
rose by 0.36 percent in September, bringing the total figures in
the first nine months of the year to a modest level of 2.48
percent, with year-on-year inflation at 6.2 percent.
BPS said if the current trend continued, full-year inflation
would only reach 6 percent by year-end, around the same level
targeted by the state budget.