BI expects to book Rp 4 trillion surplus in 2000
BI expects to book Rp 4 trillion surplus in 2000
JAKARTA (JP): Bank Indonesia expects to book a surplus of some
Rp 4 trillion (US$465.12 million) in the 2000 financial year if
the current exchange rate and interest rate levels persist
throughout the year, according to a senior official at the
central bank.
Bank Indonesia director for internal finances Bumbunan Hutapea
said on Wednesday a weakening of the rupiah would benefit the
central bank because it would be able to sell dollars at a higher
rate.
"We forecast BI will have a surplus of Rp 4 trillion by the
end of 2000," Hutapea said during a media conference.
He said the surplus would be greater if the rupiah further
weakened, while a strengthening of the rupiah would result in a
smaller surplus.
The central bank booked a deficit of Rp 5.4 trillion in the
May to December period of 1999. Bank Indonesia became an
independent central bank on May 17.
Bumbunan said the 1999 deficit was largely the result of the
strengthening of the rupiah to approximately Rp 7,000 to the U.S.
dollar from about Rp 10,000 in 1998.
The rupiah closed lower at Rp 8,648 to the dollar on Wednesday
from Rp 8,600 on Tuesday.
The central bank occasionally sells dollars to help strengthen
and stabilize the local currency. It also can allow the interest
rate of its Bank Indonesia SBI promissory note to increase to
strengthen the rupiah.
But Bumbunan said if the interest rate increased it would cost
the central bank, thus potentially eroding its surplus.
Bank Indonesia has raised the short-term SBI interest rate by
more than 44 basis points since early May to help defend the
rupiah.
The interest rate on the one-month SBI notes rose to 11.74
percent on Wednesday from 11.32 percent the previous week.
Bank Indonesia officials have said the interest rate will not
breach the 12 percent level if the domestic political situation
improves, particularly following the August session of the
People's Consultative Assembly, during which President
Abdurrahman Wahid will deliver an accountability speech.
Bumbunan said the cost of the central bank's monetary actions
had become greater recently, largely due to the continuing
domestic social and political problems which are the primary
factor behind the weakening of the currency.
He said the cost to the central bank for the repayment of the
interest rate on its SBI notes had reached Rp 1 trillion per
month.
Bank Indonesia released this week its 1999 financial
statement, which had been designated a "qualified opinion" by the
Supreme Audit Agency (BPK).
BPK earlier issued a "disclaimer" for the financial statement.
The agency later changed this to a qualified opinion following a
second audit.
According to Bank Indonesia's 1999 financial statement, the
central bank has total assets of 476.3 trillion, total
liabilities of Rp 392.9 trillion and total equities of Rp 83.4
trillion.
Revenue totaled Rp 12.6 trillion, while spending reached Rp 18
trillion, resulting in a deficit of Rp 5.4 trillion.(rei)
JAKARTA (JP): Bank Indonesia expects to book a surplus of some
Rp 4 trillion (US$465.12 million) in the 2000 financial year if
the current exchange rate and interest rate levels persist
throughout the year, according to a senior official at the
central bank.
Bank Indonesia director for internal finances Bumbunan Hutapea
said on Wednesday a weakening of the rupiah would benefit the
central bank because it would be able to sell dollars at a higher
rate.
"We forecast BI will have a surplus of Rp 4 trillion by the
end of 2000," Hutapea said during a media conference.
He said the surplus would be greater if the rupiah further
weakened, while a strengthening of the rupiah would result in a
smaller surplus.
The central bank booked a deficit of Rp 5.4 trillion in the
May to December period of 1999. Bank Indonesia became an
independent central bank on May 17.
Bumbunan said the 1999 deficit was largely the result of the
strengthening of the rupiah to approximately Rp 7,000 to the U.S.
dollar from about Rp 10,000 in 1998.
The rupiah closed lower at Rp 8,648 to the dollar on Wednesday
from Rp 8,600 on Tuesday.
The central bank occasionally sells dollars to help strengthen
and stabilize the local currency. It also can allow the interest
rate of its Bank Indonesia SBI promissory note to increase to
strengthen the rupiah.
But Bumbunan said if the interest rate increased it would cost
the central bank, thus potentially eroding its surplus.
Bank Indonesia has raised the short-term SBI interest rate by
more than 44 basis points since early May to help defend the
rupiah.
The interest rate on the one-month SBI notes rose to 11.74
percent on Wednesday from 11.32 percent the previous week.
Bank Indonesia officials have said the interest rate will not
breach the 12 percent level if the domestic political situation
improves, particularly following the August session of the
People's Consultative Assembly, during which President
Abdurrahman Wahid will deliver an accountability speech.
Bumbunan said the cost of the central bank's monetary actions
had become greater recently, largely due to the continuing
domestic social and political problems which are the primary
factor behind the weakening of the currency.
He said the cost to the central bank for the repayment of the
interest rate on its SBI notes had reached Rp 1 trillion per
month.
Bank Indonesia released this week its 1999 financial
statement, which had been designated a "qualified opinion" by the
Supreme Audit Agency (BPK).
BPK earlier issued a "disclaimer" for the financial statement.
The agency later changed this to a qualified opinion following a
second audit.
According to Bank Indonesia's 1999 financial statement, the
central bank has total assets of 476.3 trillion, total
liabilities of Rp 392.9 trillion and total equities of Rp 83.4
trillion.
Revenue totaled Rp 12.6 trillion, while spending reached Rp 18
trillion, resulting in a deficit of Rp 5.4 trillion.(rei)