Economist Says BI and Government Policies Are Right Steps to Strengthen Rupiah

Economist from Muhammadiyah University of Bengkulu, Dr. Surya Vandiantara, has assessed that the policies of Bank Indonesia (BI) and the government to increase the yield attractiveness of domestic financial instruments and maintain financial and banking market liquidity are the right steps in strengthening the rupiah exchange rate. According to him, the increase in yields on domestic financial instruments will encourage foreign capital or portfolio inflows to flow heavily into the country, thereby impacting the strengthening of the rupiah exchange rate. “If portfolio inflows increasingly pour into Indonesia through Government Securities (SBN), the greater the opportunity for the country to manage that foreign capital into programmes that can have a direct impact on increasing national productivity,” Surya said in his statement on Tuesday, 9 June 2026. “This will trigger an increase in demand for the rupiah, so that the rupiah exchange rate will become stronger in facing pressure from foreign currencies such as the US dollar,” he said. Regarding the policy of placing cash management at Bank Indonesia (BI) to maintain financial and banking market liquidity, Surya described the effort as a breath of fresh air for state revenue, because the government will receive remuneration for the policy. However, he cautioned that the policy must be able to be channelled in the form of additional liquidity to the banking system, so that it can be absorbed by business actors. “The government needs to be careful in managing this policy. State cash management at the central bank must be able to be channelled in the form of additional liquidity to the banking system,” said Surya. “This policy also needs to be followed by a reduction in the benchmark interest rate, so that business actors can absorb capital more optimally to develop their businesses,” he said. According to him, coordination between BI and the government is one of the key factors in driving positive sentiment for the rupiah, because it encourages more synchronised policy collaboration between fiscal and monetary sides. “Without close coordination, the policy options of increasing domestic financial instrument yields and maintaining financial and banking market liquidity will never be achieved,” said Surya. Going forward, Surya continued, the challenge for the government and BI is to maintain the maximum implementation of these policies. If this is done in a disciplined manner, he believes the effort will have an impact on strengthening the rupiah in the future.