A widening gap between Indonesian and US interest rates could help draw capital inflows to the country and strengthen the domestic currency, Bank Indonesia (BI) Senior Deputy Governor Miranda Goeltom said Wednesday (5/3/08), Dow Jones Newswires reported.
"There's no problem with hot money coming in, as long as our (domestic) fundamentals are good," Goeltom said.
She said more fund inflows would strengthen the rupiah against the dollar, which would help fight imported inflation.
Meanwhile, Asia in Focus reported that BI has predicted that the rupiah, which was quoted around 9,100 against the US dollar during the week, will hover at that level throughout the rest of the year.
Goeltom said that external factors will weigh on the rupiah movement but the currency is gaining greater strength.
Find Article by Date