Foreign Exchange Reserves Fall 1 Billion Dollars In A Month, Bank Indonesia: Government Pays Debt

JAKARTA - Bank Indonesia (BI) reported that the position of foreign exchange reserves (cadev) at the end of December 2021 had decreased by around 1 billion US dollars.

It was stated that last month cadev was in the position of 144.9 billion US dollars. This figure is lower than the November 2021 record of USD 145.9 billion.

"Despite the decline, Indonesia's foreign exchange reserves remain high," said Head of the BI Communications Department Erwin Haryono as quoted on the official website, Friday, January 7.

According to Erwin, there were a number of factors that influenced the collapse of the RI cadev last month, with the main factor being the need for government funds.

"The decline in the position of foreign exchange reserves in December 2021 was influenced, among other things, by the need for payment of the government's foreign debt," he said.

Furthermore, Erwin explained that Indonesia's foreign exchange is quite capable in terms of state capabilities. This is reflected in several macroeconomic indicators.

"The position of foreign exchange reserves is equivalent to financing 8.0 months of imports or 7.8 months of imports and servicing government foreign debt, and is above the international adequacy standard of about 3 months of imports," he said.

For this reason, he concluded that there was no problem with the decline in Indonesia's foreign exchange reserves even though it experienced a correction of 1 billion US dollars in a month.

"Bank Indonesia views the foreign exchange reserves as capable of supporting external sector resilience and maintaining macroeconomic and financial system stability," he said.

According to VOI records, the government's debt at the end of November 2021 was IDR 6.713.24 trillion. This figure increased by 25.96 trillion trillion compared to the October 2021 period which was 6.687.28 trillion.

In detail, the debt in November 2021 consists of IDR 832.51 trillion in loans and IDR 5.889.73 trillion in state securities (SBN). Meanwhile, SBN is divided into two categories, namely SBN released in the domestic market of IDR 4.614.96. trillion and foreign currency SBN (foreign currency) of IDR 1.274.77 trillion.

"Going forward, Bank Indonesia views foreign exchange reserves as adequate, supported by stability and maintained economic prospects, along with various policy responses to promote economic recovery," Erwin concluded.