Bank Indonesia: Stability Of The Indonesian Financial System Semester I 2022 Guarded

JAKARTA Bank Indonesia (BI) stated that financial system stability (SSK) in the first semester of 2022 will be maintained amidst the slowdown in global economic recovery and is supported by continued recovery in the domestic economy.

BI Governor Perry Warjiyo said the maintenance of the financial system was reflected in high-growing intermediation, strong financial system resilience, and increased financial inclusion.

"Synergy and policy innovation are the keys to the stable financial system in the midst of global uncertainty," he said in an official statement quoted on Sunday, October 23.

According to Perry, Bank Indonesia believes that in the future SSK will be maintained, although some global and domestic challenges need to be watched out for. It was also revealed that the central bank saw three important points of concern at this time.

First, the BI assessment shows that financial system stability is in a maintained condition amidst the global economic slowdown, high global inflation and aggressive tightening of monetary policy for developed countries.

Second, policy innovation, including accommodative macroprudential policies, continues to be strengthened to encourage intermediation performance and financial inclusion, while maintaining financial system resilience.

"And the third is Bank Indonesia's policy synergy with the Financial System Stability Committee (KSSK) which continues to be strengthened to maintain macroeconomic and financial system stability," he said.

Based on VOI records, BI decided to raise the benchmark interest rate by 50 basis points (bps) to 4.75 percent as a front load, pre-emptive, and forward looking step to reduce inflation expectations which are currently overshooting.

In terms of inflation, the Central Statistics Agency (BPS) reported that it was at the level of 5.95 percent in September 2022. Meanwhile, another macro indicator, namely the APBN, is known to still record a surplus of IDR 60.9 trillion until last month.