Foreign Exchange Reserves Drop To The Level Of 130 Billion US Dollars, The 'Green' Effect Is Getting Rare?

Illustration (Photo: Doc. Antara)

JAKARTA - Bank Indonesia (BI) released the latest data which states that foreign exchange reserves are under pressure again and are in the position of 130.2 billion US dollars in October 2022.

Director of the Department of Communications, Junanto Herdiawan, revealed that this amount was less than the closing of September 2022 with a value of 130.8 billion US dollars. That is, there is a decrease of about 600 million dollars within one calendar month.

"The decline in the position of foreign exchange reserves in October 2022 was influenced, among other things, by the payment of the government's foreign debt," he said in a press statement today, Monday, November 7.

According to Junanto, there are other factors that are causing the depletion of the stock of 'The Green' aka the dollar in the country.

"(The decline in foreign exchange reserves) is also due to the need for stabilization of the rupiah exchange rate in line with the increasing uncertainty of global financial markets," he said.

The director of the central bank also explained that the amount currently owned by Indonesia is equivalent to financing 5.8 months of imports or 5.6 months of imports and payment of the government's foreign debt.

"We are still above the international adequacy standard of about 3 months of imports," he stressed.

Junanto added that Bank Indonesia assessed that the foreign exchange reserves were able to support external sector resilience and maintain macroeconomic and financial system stability.

"Going forward, Bank Indonesia views foreign exchange reserves as adequate, supported by stability and maintained economic prospects, along with various policy responses to maintain macroeconomic and financial system stability to support the national economic recovery process," he stressed.

For information, the number of dollars circulating in the world market is indeed in a decreasing trend. This is inseparable from the policy of the US central bank, The Federal Reserve aka The Fed, which continues to accelerate the reduction of liquidity globally (tapering).

The move aims to save the domestic economy of the United States, which is struggling with high inflation levels.