The central bank of Indonesia (Bank Indonesia) announced today (08/08) that the country’s foreign exchange reserves increased to USD $110.5 billion at the end of July 2014 (from USD $107.7 billion at the end of the previous month). Bank Indonesia said that the rising reserves were mainly due to receipts from the Euro bonds issued by the Indonesian government and foreign exchange earnings from oil and gas exports. In addition, buoyant foreign capital inflows also had a positive impact on the accumulation of the official reserve assets.

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The central bank of Indonesia (Bank Indonesia, BI) released a statement on Monday (07/07) which shows that the country’s foreign exchange reserves have expanded 0.7 percent to USD $107.7 billion in June 2014 mainly on an increase of the government’s oil & gas revenue (that exceeds the foreign debt payment) and higher foreign-exchange term deposits at local banks, reducing the need for Bank Indonesia to intervene in the foreign exchange market. However, the central bank did not provide any figures on these revenues and deposits.

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The central bank of Indonesia (Bank Indonesia) announced that its foreign exchanges reserves had risen to USD $107.0 billion by the end of May 2014, up from USD $105.6 billion at the end of the previous month. This increase primarily stemmed from government oil and gas export earnings as well as an influx of foreign portfolio capital into Southeast Asia's largest economy, which reflects the positive perception of international investors with regard to the economic fundamentals of Indonesia.

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Indonesian Finance Minister Chatib Basri said that the country's current account deficit, the broadest measure of international transactions, may widen in the second quarter of 2014 as many local companies engage in business expansion. Such expansion usually triggers an increased amount of imports, thus impacting on the trade balance. A widening current account deficit in the second quarter of the year is a normal trend. The balance usually improves in the third and fourth quarters.

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The foreign exchange reserves at the central bank of Indonesia (Bank Indonesia) increased about USD $3 billion to USD $105.6 billion at the end of April 2014, the highest level in 15 months, particularly due to export earnings of government-owned oil and gas exporters. Bank Indonesia said that the current position of forex reserves is equivalent to 6.1 months of imports or 5.9 months of imports and servicing external debt (well above the international standard of three months of imports). Today, the central bank's Board of Governors Meeting is held.

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Indonesia’s official foreign exchange reserve assets stood at USD $102.6 billion as of the end of March 2014, a slight decline from the level of USD $102.7 billion in the previous month. The decline was mainly due to government payments in the context of its maturing global bond in March 2014. At this level, reserve assets can adequately cover 5.9 months of imports or 5.7 months of imports as  well as servicing of government external debt repayment, well above the international standards of reserves adequacy at three months of imports.

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Indonesian consumer confidence continued to grow in March 2014. According to the latest survey of Indonesia's central bank (Bank Indonesia), the country's consumer confidence rose to 118.2 in March from 116.2 one month earlier. Indonesians are particularly optimistic about domestic economic conditions over the next six months, evidenced by a 3.2 point rise in the Consumer Expectations Index to 123.9 points. Increasing consumer confidence is positive for household consumption, an important pillar of Indonesia's economic growth.

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As had been confirmed by Agus Martowardojo, Governor of Bank Indonesia, earlier this week, Indonesia's foreign exchange reserves rose 2.1 percent to USD $102.74 billion at the end of February 2014, particularly due to strong capital inflows. According to Martowardojo, capital inflows in the first two months of 2014 exceed net capital inflows throughout 2013. Bank Indonesia regards the current foreign exchange reserves sufficient to underpin external sector resilience and maintain sustainable economic growth in Indonesia looking ahead.

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Foreign debt of Indonesia totaled USD $264 billion per December 2013. Based on data from Statistics Indonesia, 46.8 percent of this total debt was accounted for by the public sector, while the remaining 53.2 percent was private sector debt. On a year-on-year (yoy) basis, growth of Indonesia’s total debt slowed to 4.06 percent in the last month of 2013. One year earlier this growth was significantly higher at 12.0 percent. Indonesia’s level of foreign debt is still safe at 30.2 percent of GDP in the fourth quarter of 2013.

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The central bank of Indonesia (Bank Indonesia/BI) left its benchmark interest rate (BI rate) unchanged at 7.50 percent in the Board of Governor's Meeting on Thursday (13/02/14). This decision was in line with market expectations as several economic indicators have improved. In recent days, the rupiah exchange rate has shown a marked improvement to IDR 12,055 per US dollar (Bloomberg Dollar Index) as pressures on Indonesia's current account balance are easing and Bank Indonesia's foreign exchange reserves are rising.

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The government of Indonesia plans to issue global sukuk (the Islamic equivalent of bonds) and retail bonds (Obligasi Ritel Indonesia, abbreviated ORI) in October 2013. Proceeds from the bond issuances will be used to finance the budget deficit, which is targeted at 2.48 percent of gross domestic product (GDP) in the 2013 Revised State Budget (APBN-P). This percentage figure is equivalent to IDR 233.7 trillion (USD $23.82 billion), and represents a robust increase compared to the deficit in 2012 (at 1.77 percent of GDP).

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