JAKARTA - Governor of Bank Indonesia (BI) Perry Warjiyo stated that the rupiah exchange rate has weakened by 8.03 percent this year (year to date/ytd). According to him, this condition is inversely proportional to the strengthening of the US dollar which amounted to 18.1 percent ytd.
"The weakening of the rupiah is still lower than other countries, such as India 10.42 percent, Malaysia 11.75 percent and Thailand 12.55 percent," he said during a press conference on Thursday, October 20.
Perry explained that the weakening of the exchange rate had its own effect in maintaining the stability of international trade.
"All countries stabilize the rupiah exchange rate to mitigate imported inflation. Of course, we also do the same thing in order to maintain macroeconomic stability," he said.
Furthermore, the BI boss emphasized that rupiah depreciation can still be dammed and does not spread to various strategic sectors of the economy.
"We avoid the impact of its propagation not only on inflation but also on the banking and corporate sectors," he added.
"So far, the level of rupiah weakening has not had an impact on banking or corporate conditions," he said.
To note, rupiah's eye depreciation is in line with the strengthening of the US dollar and the increasing uncertainty in global financial markets due to the tightening of more aggressive monetary policy in various countries.
"In the future, Bank Indonesia will continue to monitor the development of foreign exchange supply and strengthen the policy of stabilizing the rupiah exchange rate in accordance with the market mechanism and its fundamental value to support efforts to control inflation and macroeconomic stability," Perry said.
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