Alert! Bank Indonesia Believes Global Economic Uncertainty Remains High

BI Governor Perry Warjiyo (Photo: Doc. Antara)

JAKARTA Conference of the Board of Governors of Bank Indonesia (RDG BI) believes that global economic conditions will not be better than the previous projections. In fact, the potential for pressure is expected to strengthen as inflation is still high in developed countries.

"The global economic uncertainty remains high. The pressure of inflation in developed countries is still relatively high, influenced by a stronger economy and a strict labor market," said BI Governor Perry Warjiyo in Jakarta, Tuesday, July 25.

According to Perry, this is expected to encourage further increases in monetary policy interest rates in developed countries, including the Federal Funds Rate (FFR).

"These developments encourage capital flows to developing countries to be more selective and increase exchange rate pressures in developing countries, including Indonesia, thus requiring a strengthening of policy responses to mitigate the risk of global propagation," he said.

However, Perry sees that there is a slight positive signal shown through this development to encourage capital flows to developing countries to be more selective and increase exchange rate pressures in developing countries, including Indonesia, thus requiring a strengthening of policy responses to mitigate the risk of global propagation.

Perry menjelaskan, pertumbuhan ekonomi Jepang diperkirakan masih kuat dipengaruhi oleh konsumsi rumah tangga dan ekspor yang membaik.

"Meanwhile, China's economic growth is lower in line with the delay in consumption and investment, especially the property sector," he added.

To note, global economic growth throughout 2023 is predicted to remain at 2.7 percent, but accompanied by a shift in sources of growth.