House of Representatives' Commission XI calls for layered mitigation to prevent imported inflation
If the Rupiah’s depreciation is not mitigated quickly, the impact can be immediately felt on production costs, import prices, and the prices of essential goods for the public.
Jakarta (ANTARA) - Chairman of Commission XI of the Indonesian House of Representatives, Mukhamad Misbakhun, has urged fiscal and monetary authorities to immediately strengthen mitigation measures following pressure on the Rupiah exchange rate in recent times.
He reminded that the weakening of the currency needs to be anticipated seriously to prevent it from transmitting into imported inflation, which can suppress people’s purchasing power.
“If the Rupiah’s depreciation is not mitigated quickly, the impact can be immediately felt on production costs, import prices, and the prices of essential goods for the public,” said Misbakhun in a statement in Jakarta, Saturday.
Therefore, he encouraged Bank Indonesia to continue actively maintaining exchange rate stability through measured interventions in the spot market, Domestic Non-Deliverable Forward (DNDF), and the Government Bond (SBN) market.
According to him, stabilisation measures need to be carried out precisely in order to maintain market confidence without excessively burdening foreign exchange reserves.
“What needs to be maintained is not just the exchange rate. More importantly, it is market confidence and certainty for business actors. Policy communication must be quick, clear, and credible,” he said.
Meanwhile, from the fiscal side, Misbakhun highlighted the importance of optimising export proceeds (DHE) policies. He asked the government to ensure that exporters’ foreign exchange remains in the domestic financial system to strengthen the supply of US dollars in the country amid global pressures.
“It should not be the case that the Rupiah’s depreciation ultimately increases production costs and then puts an additional burden on the prices of goods for the public. If that happens, purchasing power could also be affected,” he said.
In closing his statement, Misbakhun assured that Commission XI of the Indonesian House of Representatives will continue to monitor the development of macroeconomic indicators and oversee policy synergy within the Financial System Stability Committee (KSSK) so that global volatility pressures do not disrupt national economic stability.
“This momentum of economic growth that has been built must be maintained together. Therefore, policy responses must not be slow and must be truly coordinated,” he said.