JAKARTA - Bank Indonesia (BI) expressed that the global economic uncertainty was getting higher, driven by the United States (US) reciprocal tariff policy.
Bank Indonesia Governor Perry Warjiyo said the US reciprocal tariff policy in early April 2025, as well as retaliation measures by China and the possibility of a number of other countries increasing global economic fragmentation and decreasing world trade volume.
"As a result, world economic growth in 2025 is predicted to decline from 3.2 percent to 2.9 percent with the largest decline occurring in the US and China in line with the impact of the tariff war between the two countries," he said at a press conference, Wednesday, April 23.
Perry menjelaskan pertumbuhan ekonomi di negara maju dan negara perkembang lainnya juga diprakirakan akan melambat, dipengaruhi dampak langsung dari penurunan ekspor ke AS dan dampak tidak langsung dari penurunan volume perdagangan dengan negara-negara lain.
According to him, the tariff war and its negative impacts on the decline in growth in the US, China, and the world economy have sparked an increase in global financial market uncertainty and encourage the risk asymptomatic behavior of capital owners.
In addition, Yield US Treasury decreased and the US dollar currency index against various currencies (DXY) weakened, amid increased expectations of the Fed Funds Rate (FFR) decline.
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He added that the world's capital flows shifted from the US to countries and assets deemed safe (safe haven assets), especially to financial assets in Europe and Japan as well as gold commodities.
Meanwhile, Perry said the global capital outflow from developing countries was still continuing, putting pressure on the weakening of its currency.
"The worsening of this global condition requires strengthening the response and coordination of policies to maintain external resilience, control stability, and encourage economic growth in the country," he said.
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