Page Nav

HIDE

Grid

GRID_STYLE

Pages

Classic Header

{fbt_classic_header}

Postingan Populer

Indonesia says clarity on Fed hikes was key Bali meeting outcome

Indonesia says clarity on Fed hikes was key Bali meeting outcome Skip to main content ...

Indonesia says clarity on Fed hikes was key Bali meeting outcome

Skip to main content

Thank you for reading The Straits Times.

Your account has timed out, login for full access to premium stories.

Login"; document.querySelector('body').innerHTML += noteHTML; document.querySelector('.timeoutmsg-area .close-button').addEventListener('click', function() { document.querySelector('.timeoutmsg-area').classList.add('hidden'); }); } } function timeoutNote() { var oneMin = 60000; var timeDur = 120; var timeoutDuration = timeDur * oneMin; setTimeout(timeoutEvt ,timeoutDuration); } Indonesia says clarity on Fed hikes was key Bali meeting outcome
Perry Warjiyo speaking at the IMF and World Bank Group Annual Meetings in Nusa Dua, Bali.
Perry Warjiyo speaking at the IMF and World Bank Group Annual Meetings in Nusa Dua, Bali.
PublishedOct 14, 2018, 4:26 am SGT

DENPASAR (BLOOMBERG) - Bank Indonesia Governor Perry Warjiyo said clarity on the gradual pace of United States interest rate hikes was one of the key takeaways of last week's International Monetary Fund (IMF) and World Bank meetings in Bali.

The signals on policy normalisation from the US Federal Reserve officials and other developed market central bankers were among the "positive" outcomes of the talks, and should hopefully ease pressure in financial markets, especially in emerging economies, Mr Warjiyo said in an intervi ew with Bloomberg TV's Haslinda Amin in Bali on Saturday (Oct 13).

"We are seeing that the normalisation process of monetary policy in advanced countries, especially from the US Fed, will be gradual," he said.

"And the Fed will also continue to communicate clearly the future course of the normalisation process."

With trade tensions overshadowing talks in Bali this week, policymakers from emerging economies have been worrying about a prolonged rout in financial markets, triggered by US rate hikes and a stronger dollar.

Bank Indonesia has already raised borrowing costs five times since May to help stabilise the rupiah, which is down almost 11 per cent against the US currency this year.

Mr Warjiyo said clarity from the Fed should help in "reducing the volatility of flows as well as volatility of the market and the exchange rate".

Indonesia has been one of the har dest hit economies in Asia in the global emerging-market sell-off, with twin deficits on the current account and budget, as well as a relatively high foreign ownership of its bonds, making the nation vulnerable to outflows.

UNDERVALUED CURRENCY

Mr Warjiyo said the rupiah is "undervalued", given the economy's fundamentals. The economy is expanding more than 5 per cent, inflation is low and the fiscal deficit is below 2 per cent of gross domestic product, he said.

"I do believe that what you are seeing in the rupiah development, I think it's already misaligned from the fundamentals," he said.

With the US and China continuing a tit-for-tat battle on trade, and oil prices on the rise, Indonesia is calling for a multilateral response to protectionist headwinds as well as for global monetary policy to be better synchronised.

The IMF communique was "quite positive", Mr Warjiyo said, with the global economy remaini ng quite strong.

Referring to warnings by President Joko Widodo, who recently invoked the popular Game Of Thrones TV show to refer to worsening global risks - the governor said perhaps the "winter is not strong".

Topics:
  • INDONESIA
  • US FEDERAL RESERVE
  • INTEREST RATES

Branded Content

We have been experiencing some problems with subscriber log-ins and apologise for the inconvenience caused. Until we resolve the issues, subscribers need not log in to access ST Digital articles. But a log-in is still required for our PDFs.

Source: Google News Indonesia | Netizen 24 Indonesia

No comments