Darmin Appreciates BI's Decision to Maintain Key Rate

Nia Deviyana    •    21 Desember 2018 13:00 WIB
macroeconomics (en)
Darmin Appreciates BI's Decision to Maintain Key Rate
Illustration (Photo:Medcom/M Rizal)

Jakarta: Coordinating Minister for Economic Affairs Darmin Nasution said Friday that the central bank's decision to maintain its key interest rate will further stabilize the Indonesian economy.

Bank Indonesia (BI) decided to maintain its 7-Day Reverse Repo Rate at 6.00% after a Board of Governors meeting this week. It also decided to maintain the Deposit Facility and Lending Facility rates at 5.25% and 6.75% respectively.

According to BI's press release, the policy rate will strengthen efforts to maintain the attractiveness of domestic financial assets and reduce the current account deficit. In addition, the central bank will also strengthen coordination with the Government and other relevant authorities to maintain economic stability and strengthen external resilience.

"The real sector is under control. The capital markets are also the same," Darmin said.

Indonesia’s trade balance recorded a deficit in November 2018 as a corollary of global dynamics less conducive to growth. The trade deficit stood at US$2.05 billion in the reporting period due to declining export performance on flat global economic growth and sliding prices for Indonesian export commodities.

The position of reserve assets at the end of November 2018 remained solid at US$117.2 billion. It was equivalent to 6.5 months of imports or 6.3 months of imports and servicing government external debt, which is well above the international standard of three months.