Bank Indonesia Governor Agus Martowardojo Wins Award
The governor of Indonesia's central bank (Bank Indonesia), Agus Martowardojo, won the Governor of the Year award for the East Asia-Pacific region. The winner of the award was announced by Global Markets, a newspaper that is part of Euromoney Institutional Investor.
Every year Global Markets selects a central bank governor of the year. This year Bank Indonesia Governor Agus Martowardojo was chosen based on the transformation and reformation policies that were implemented at Indonesia's lender of last resort over the past 12 months.
One key transformation that was mentioned in Global Markets' press release was the Indonesian central bank's enhanced ability to communicate its policies to market participants as well as the wider public. Martowardojo is considered to be the mastermind behind the enhanced quality of communication. Through providing good signals in times of (looming) policy re-directions, any potential market shocks can be avoided.
An example of reformation is the adoption of the seven-day reverse repurchase rate (reverse repo) as Indonesia's new benchmark (replacing the BI Rate). The reverse repo influences borrowing costs and market liquidity more effectively (Bank Indonesia now sells securities with an agreement to buy them back within a seven-day period). Another example is the decision to change banks' minimum reserve requirement (GWM) from a daily to an average one.
Lastly, Global Markets praised Martowardojo for his continuous efforts to deepen the financial markets of Indonesia.
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