JAKARTA - Bank Indonesia (BI) expressed the high uncertainty of the global financial market lowering foreign capital inflows to domestic financial instruments with Government Securities (SBN) and Bank Indonesia Rupiah Securities (SRBI).
BI Governor Perry Warjiyo said that until January 13, 2025, foreign capital flows that entered SRBI reached USD 288 million. Meanwhile, foreign capital flows that entered SBN amounted to USD 19 million.
"The high uncertainty of global financial markets has lowered foreign capital inflows into domestic financial instruments with SBN and SRBI," he said at a press conference, Wednesday, January 15.
Even so Perry said, the money market interest rate (IndONIA) was moving around BI-Rate, which was 6.03 percent on January 14, 2025.
Meanwhile, SRBI interest rates for tenors 6, 9, and 12 months on January 10, 2025 were recorded attractively to support foreign capital inflows at the level of 7.06 percent, 7.10 percent and 7.23 percent, respectively.
While the yields from SBN tenors were 2 years and 10 years as of January 14, 2025, increased to 6.98 percent and 7.25 percent, respectively, so that they also maintained the attractiveness of domestic financial instruments in the midst of continued global uncertainty.
Meanwhile, Perry said that banking interest rates were maintained in terms of adequate banking liquidity and banking efficiency in developing better prices with SBDK transparency.
Meanwhile, the 1 month deposit interest rate and credit interest rate in December 2024 were recorded at 4.87 percent and 9.20 percent, respectively, relatively stable compared to the previous month's level.
Perry said that the pro-market monetary instrument was optimized to strengthen efforts to stabilize the Rupiah exchange rate and achieve inflation targets.
"This policy is also intended to accelerate efforts to deepen the foreign exchange market and market as well as encourage foreign capital inflows into the country," he said.
Perry conveyed that until January 14, 2025, the position of the Rupiah Bank Indonesia Securities (SRBI), Bank Indonesia Valas Securities (SVBI), and Bank Indonesia Sukuk Valas (SUVBI) were recorded at IDR 914.72 trillion, 1.96 billion US dollars, and 436 million US dollars, respectively.
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According to him, the issuance of SRBI has supported efforts to increase foreign portfolio entry flow into the country and strengthen the Rupiah exchange rate.
The non-resident ownership in SRBI reached IDR 228.85 trillion or 25.02 percent of the total outstanding.
Perry conveyed that the implementation of major dealers (primary dealers) since May 2024 has also further increased SRBI transactions in the secondary market and repurchase agreement (repo) between market actors, thereby strengthening the effectiveness of monetary instruments in stabilizing the Rupiah exchange rate and controlling inflation.
In the future, Perry said that Bank Indonesia will continue to optimize various innovations in pro-market instruments, both in terms of volume and supply aspects, in order to increase the effectiveness of monetary policy transmission, accelerate the deepening of the foreign exchange market and market, and encourage foreign capital inflows.
"The transition of monetary policy through interest rates is running well in an effort to support economic growth," he said.
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