A senior official said on Wednesday ( May 7 ) that Indonesia’s central bank is focused on promoting economic growth without compromising on price stability, including the exchange rate, as the rupiah weakened once more amid rising tensions between India and Pakistan.
The central banks will try to strike the “optimum stability” between price stability and economic growth, according to Juli Budi Winantya, a chairman in Bank Indonesia’s economic and monetary policy section.  ,
When asked about the policy rate view, he said at an economical conference that the central bank’s goal was to drive for development without compromising balance. However, the current economic growth was still below its potential.
Official data from Indonesia’s first-quarter socioeconomic development showed that it was 4.87 percent, which is the slowest increase in more than three years, but it was still in line with business expectations.
” We should drive economic growth even farther,” Juli remarked. The BI scheme is to strike the ideal balance between promoting balance and promoting growth.
The largest economy in Southeast Asia’s latest growth outlook for 2025 was substantially below the 4- to 5-percent range, according to BI’s most recent forecast for development.
In an effort to boost economic exercise, it has cut interest rates half since September, but it has now paused its easing routine in order to concentrate on maintaining the rupee firm.
The head of financial management at the bank, Erwin Gunawan Hutapea, told reporters differently that the main bank said it would keep its reputation in the foreign exchange market to boost confidence.
In light of rising geopolitical concerns in India and Pakistan and ahead of the US Federal Reserve’s economic policy review’s finish, the ringgit has increased after hitting a historical low in April. However, the ringgit dropped 0.55 percent to 16 535 a buck on Wednesday.
Erwin noted that foreign investors had begun purchasing Indian assets once more, including during the president’s bond auction this month, which would help the ringgit, but he cautioned that domestic US dollar requirements for dividend repatriation and international debt payments could have an impact on exchange rate movements in the upcoming months.
According to Erwin, BI has focused its open market operations on expanding cash in an effort to support growth, including by steadily lowering the amount of SRBI that is still remarkable.
He declared,” We want BI’s operations to have an expansionary impact and support growth.” ” As a result, we have steadily reduced outstanding SRBI… by 40 trillion rupiah… so much, by 20 trillion rupiah.”
According to the central company’s website, the exceptional SRBI as of April 21 was 881.86 trillion ringgit.