BI Governor Assures Sufficient Foreign Exchange Reserves Amid Rising Demand in April-May
Jakarta (ANTARA) - Bank Indonesia Governor Perry Warjiyo has assured that foreign exchange requirements will be fulfilled during the increased demand due to seasonal factors in the April to May 2026 period.
Perry stated that the surge in foreign exchange demand during that period is triggered by public needs for umrah and hajj worship, as well as corporations conducting dividend repatriations and foreign debt payments.
“Coincidentally, seasonally, April and May see high foreign exchange demand,” said Perry during the Financial System Stability Committee (KSSK) press conference in Jakarta on Thursday.
Amid the ongoing exchange rate weakening, Perry emphasised that the central bank remains fully committed to safeguarding rupiah stability by continuing to coordinate with the government.
“Why is there rupiah weakening? All world currencies are weakening. We are keeping the level of weakening from being too high by going all out,” he said.
Furthermore, he explained that the exchange rate weakening is driven by global factors, including high geopolitical tensions in the Middle East and rising world oil prices.
Additionally, high US interest rates are prompting foreign investors to withdraw funds from emerging market countries, thereby strengthening the US dollar exchange rate.
Perry stressed that the rupiah is currently undervalued compared to the economic fundamentals.
On the other hand, he assured that the domestic economic conditions remain solid, with economic growth of 5.61 per cent (year-on-year) in the first quarter of 2026, a trade balance that continues to record a surplus, and high foreign exchange reserves.
The trade balance for January to March 2026 recorded a surplus of US$5.5 billion, supported by a non-oil and gas trade surplus amid an oil and gas trade deficit.
Then, Indonesia’s foreign exchange reserves position at the end of March 2026 stood at US$148.2 billion, equivalent to financing six months of imports and above the international adequacy standard of around three months of imports.
In early second quarter to 30 April 2026, foreign capital flows recorded net inflows of US$3.3 billion, particularly in Bank Indonesia Rupiah Securities (SRBI) and Government Securities (SBN), driven by increased yields on both instruments.
Previously, during the first quarter of 2026, foreign portfolio investment experienced net outflows of US$1.7 billion, influenced by capital outflows due to high global financial market uncertainty triggered by Middle East conflicts.