Deputy Minister Of Finance Suahasil Nazara: The Condition Of The Indonesian Economic Fundamentals Is Still Strong To Hold The Rate Of Weakening Of The Rupiah

Deputy Minister of Finance (Wamenkeu) RI Suahasil Nazara. (Photo: Doc. Antara)

JAKARTA - Deputy Minister of Finance (Wamenkeu) Suahasil Nazara ensured that the current fundamental condition of Indonesia's economy is still strong to hold back the pace of rupiah weakening which occurred for two days after the long Eid al-Fitr 2024 holiday.

"Our economicfundamental is good. However, before and during the Eid holiday there really had been several changes in the international community," said Suahasil during a press conference in Jakarta, quoted from Antara, Friday, April 19.

During the Eid holiday in Indonesia, said Suahasil, inflation in the United States (US) was announced and the figure was higher than market expectations and analysts.

The projected reduction in the benchmark interest rate of the US Central Bank or the Fed has also become increasingly higher for longer, thus encouraging the strengthening of the US dollar index.

Then, the weakening of the rupiah was also overshadowed by heated geopolitical conflicts between Iran and Israel on Saturday, April 13.

"After the Eid holiday opened on Tuesday, April 16, then there were some changes. We see that in these two days it has subsided, of course we hope that there will be no escalation of conflicts globally," said Suahasil.

He emphasized that the government will continue to observe and observe developments in the global situation. Suahasil also emphasized the importance of maintaining the volatility of the rupiah exchange rate.

Therefore, Suahasil ensured that the Ministry of Finance (Kemenkeu), Bank Indonesia (BI), the Financial Services Authority (OJK), and the Deposit Insurance Corporation (LPS) who are members of the Financial System Stability Committee (KSSK) continue to monitor economic conditions and see points that ensure the stability of the national financial system.

"We also see that all banking institutions, non-bank financial institutions, insurance, and others are still running very well and we will continue to monitor this stability together, of course with the Coordinating Ministry for the Economy," said Suahasil.

The rupiah exchange rate against the US dollar has weakened in recent days and has touched IDR 16,000 per US dollar. The weakening of the rupiah occurred due to several factors, including external factors such as global geopolitical tension to data on US economic indicators that looked solid.

At the start of trading Tuesday, April 16, or the first working day after the Eid holiday, the rupiah exchange opened to decline by 240 points or 1.51 percent to Rp. 16,088 per US dollar from the close of the previous trade on April 5, 2024, amounting to Rp. 15,848 per US dollar.

Then on Thursday afternoon, the rupiah exchange rate closed up 41 points or 0.25 percent to Rp16,179 per US dollar from the previous Rp16,220 per US dollar.