Below is a list with tagged columns and company profiles.

Today's Headlines Bank Indonesia

  • DBS Bank Expects Indonesian Inflation to Remain Modest in December 2013

    DBS Bank Expects Indonesian Inflation to Remain Modest in December 2013

    The DBS Bank expects that Indonesia's inflation rate will reach 8.2 percent (year-on-year) by the end of 2013, supported by a low monthly inflation rate in the last month of the year. The DBS Bank believes that the pace of inflation in December 2013 will be slightly higher than the country's November inflation (0.12 percent). In the period January to November 2013, inflation in Southeast Asia's largest economy has accumulated to 7.79 percent (yoy). The bank also stated that it expects inflation to reach 6.7 percent in full-year 2014.

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  • IMF: Slowing Growth and Widening Macro-Imbalances in Indonesia

    IMF: Slowing Growth and Widening Macro-imbalances in Indonesia

    The International Monetary Fund (IMF) detects a slowdown in GDP growth in major emerging market economies and decline in commodity prices, and more recently, a reversal in push factors tied to a prospective exit from extraordinarily easy global monetary conditions, has put pressure on Indonesia’s balance of payments and heightened its vulnerability to shocks. Domestic policy accommodation and rising energy subsidies have also given rise to increased external and fiscal imbalances.

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  • Indonesia Investments' Newsletter of 15 December 2013 Released

    On Sunday (15/12), Indonesia Investments released the latest edition of its newsletter. Our weekly newsletter contains the most important news stories on the subject of Indonesia's economy, politics and social issues that were reported in the last seven days. This week's edition includes analyses of Indonesia's benchmark interest rate, current account deficit and geothermal energy development. Visit our Join Us section if you want to sign up for our free newsletter. Our latest newsletter can be viewed here.

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  • Enhanced Financial Cooperation Central Banks of Indonesia and Japan

    Enhanced Financial Cooperation Central Banks of Indonesia and Japan

    The Bank of Japan (BoJ) and Bank Indonesia (BI) signed the third Bilateral Swap Arrangement (BSA) on 12 December 2013. The arrangement is an expansion of the current BSA which almost doubles the size of the facility from USD $12 billion to $22.76 billion. This arrangement also introduces a new feature in the form of a crisis prevention scheme to support potential and/or actual liquidity needs. Both institutions also agreed to establish a cross-border liquidity arrangement to enhance the stability of financial markets.

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  • Bank Indonesia: Indonesia's Interest Rate (BI Rate) Stays at 7.50%

    In Bank Indonesia's Board of Governors' meeting - held on Thursday (12/12) - it was decided to keep the country's benchmark interest rate (BI rate) at 7.50 percent. Executive Director of Bank Indonesia's Communication Department Difi A. Johansyah said that the current rate of 7.50 percent is in line with the institution's inflation target of 4.5 percent (plus or minus one percent). The lending facility and deposite facility (Fasbi) rates are also maintained at 7.5 percent and 5.75 percent respectively.

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  • Indonesia's Foreign Exchange Reserves Unchanged in November 2013

    Indonesia's Foreign Exchange Reserves Unchanged in November 2013

    The central bank of Indonesia (Bank Indonesia) announced that Indonesia’s official reserve assets totaled USD $97.0 billion at the end of November 2013 thus unchanged from the end of the previous month. Bank Indonesia stated that this amount is equivalent to 5.5 months of import or 5.3 months of import and servicing of government external debt. After having grown sharply in recent years, Indonesia's foreign exchange reserves have fallen from USD $112.8 billion at end-2012 as Bank Indonesia tried to support the depreciating rupiah exchange rate.

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  • Indonesia's Household Consumption and Optimism Up in November 2013

    Household consumption in Indonesia has improved in November 2013 according to Bank Indonesia's Consumer Survey. The central bank's Consumer Confidence Index (CCI) rose 4.8 points to 114.3 points. This improvement is attributable to increased available job opportunities and increased purchases of durable goods ahead of Christmas 2013 and New Year. Lastly, Indonesian consumers are more positive about Indonesia's economic condition in the coming six months.

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  • Rupiah Exchange Rate: Continued Depreciation amid Uncertainty

    The Indonesia rupiah exchange rate continued its depreciation on Wednesday (04/12). The central bank's Jakarta Interbank Spot Dollar Rate fell 1.09 percent to IDR 11,960 per US dollar after absorbing the impact of the currency's weak performance on yesterday's spot market. On Tuesday (03/12), local Indonesian companies were buying US dollars at a more attractive exchange rate after the currency had appreciated previously, thus placing serious downward pressure on the currency of Southeast Asia's largest economy.

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  • Bank Indonesia: November Inflation and October Trade Balance Improving

    Inflation in November 2013 continued to show a decelerating trend at 0.12 percent (month-to-month) or 8.37 percent (year-on-year). Although higher compared to October 2013 inflation (0.09 percent), November inflation was lower than its historical pattern in the last five years. The low inflation rate was influenced by deflation in the volatile food group with deflation of 0.57 percent (mtm), a result of the correction in chilli prices, especially in Java and eastern region of Indonesia as well as the decline in the chicken meat price in almost all areas of Indonesia.

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  • Which Sectors are Vulnerable to Indonesia's Slowing Lending Growth?

    Bank Indonesia (Indonesia's central bank) has expressed that it will support slowing credit growth in the country's banking sector next year in order to foster a more stable financial environment amid a complex external and internal context. In recent years, credit growth in Indonesia has grown over 20 percent annually, while in 2013 it is expected to slow to between 18 and 20 percent amid a tighter policy regime. In 2014, Bank Indonesia targets credit growth between 15 to 17 percent. As a result banks will be more cautious in their lending approach.

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Latest Columns Bank Indonesia

  • Official Press Release Bank Indonesia: Interest Rates Left Unchanged

    Today, Bank Indonesia kept its benchmark interest rate (BI rate) at 7.50 percent at the Board of Governors’ meeting. The lending facility rate and deposit facility rate were maintained at 7.50 percent and 5.75 percent respectively. An assessment of the economy in 2013 and outlook for 2014-2015 indicated that such policy is consistent with ongoing efforts to keep inflation within the target of 4.5±1 percent in 2014 and 4±1 percent in 2015, as well as to help reduce the current account deficit to a sustainable level.

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  • Indonesia's Retail Sales Accelerate in November; Positive Outlook for 2014

    Indonesia's Retail Sales Accelerate in November; Positive Outlook for 2014

    Indonesian retail sales surged 14 percent in November 2013 from one year earlier (the highest growth rate since July 2013). On a month-to-month basis, Indonesia's retail sales increased 1.5 percent from October 2013. These findings were the result of a survey conducted by the central bank of Indonesia (Bank Indonesia), which surveyed 650 retailers in 10 Indonesian cities. The bank's survey also indicated that Indonesian retailers may increase prices of their products in 2014 in order to compensate for the depreciating rupiah exchange rate.

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  • Regulation and Supervision on Banking Sector Transferred to the OJK

    Today (31/12), the central bank of Indonesia (Bank Indonesia) officially transfers its authority to regulate and supervise the banking sector to the Financial Services Authority (Otoritas Jasa Keuangan, abbreviated OJK). Muliaman D. Hadad, Chairman of the Board of the OJK, said that all functions, duties as well as powers of regulation and banking supervision, licensing, inspection, investigation and consumer protection have been transferred to the 35 (regional) offices of the OJK.

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  • Indonesia’s External Debt Continues its Slowing Trend in October 2013

    Indonesia’s external debt growth continued to slow in October 2013. Debt grew 5.8 percent (yoy) to USD $262.4 billion compared to 8.6 percent (yoy) growth in the previous month. Slowing growth in external debt occurred both in the public and private sector. Public sector external debt position at the end of October 2013 grew 0.5 percent (yoy) to USD $125.8 billion compared to 2.1 percent (yoy) in September. Meanwhile, private sector external debt grew steadily at 11.1 percent (yoy) to USD $136.6 billion as compared to the previous month.

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  • Searching for Financial Stability: Indonesia's BI Rate Policy Questioned

    On Thursday 12 December 2013, Indonesia's central bank (Bank Indonesia) announced that the country's benchmark interest rate (BI rate) remains unchanged at the level of 7.50 percent in December 2013. This announcement was a bit surprizing as about 80 percent of analysts expected Bank Indonesia to raise the BI rate in order to support the depreciating Indonesia rupiah exchange rate. Starting the year at IDR 9,670 per US dollar, the rupiah has fallen around 25 percent to IDR 12,081 per US dollar.

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  • Bank Indonesia: Current Account Deficit Will Continue to Ease in 2014

    The central bank of Indonesia (Bank Indonesia) estimates that Indonesia's current account deficit will ease to 3.5 percent of the country's gross domestic product (GDP) by the end of 2013. Indonesia's wide current account deficit has been one of the major financial troubles this year and managed to weaken investors' confidence in Southeast Asia's largest economy. Thus, Indonesia became one of the hardest hit emerging countries after the Federal Reserve started to speculate about an ending to its quantitative easing program.

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  • Bank Indonesia's 7.50% Policy Rate in Line with Current Economic Conditions

    Bank Indonesia's 7.50% Policy Rate in Line with Current Economic Conditions

    In Bank Indonesia's board of governors' meeting, which was held on Thursday (12/12), it was decided to maintain the country's benchmark interest rate (BI rate) at 7.50 percent. This decision was in line with market expectation but was unable to support the Jakarta Composite Index and rupiah exchange rate. The lending facility and deposit facility interest rates were also maintained at 7.50 percent and 5.75 percent respectively. Bank Indonesia decided not to change the rate as Indonesia's inflation outlook for 2014 is still within target.

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  • Sales of Ceramics in Indonesia Expected to Plunge 10% in 2014

    Sales of Ceramics in Indonesia Expected to Plunge 10% in 2014

    With slowing economic growth and a stricter monetary policy approach of the central bank, Indonesia's ceramic industry is expected to record slowing growth in 2014. This year, the country's ceramic sales are projected to amount to 400 million square meters (m²). About 12 percent of this amount is exported to countries abroad. However, in 2014, sales are expected to plunge by 5 to 10% to 360-380 million m². A weakening rupiah and slowing property sector, which accounts for significant ceramic demand, are the major causes of the decline.

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  • Investors Concerned Ahead of Bank Indonesia Board of Governor's Meeting

    Both the Jakarta Composite Index (Indonesia's benchmark stock index) and the Indonesia rupiah exchange rate are under pressure this morning as market participants are waiting for results of the central bank's Board of Governor's meeting that is held today (12/12) in Jakarta. Speculation has emerged that Indonesia's central bank (Bank Indonesia) will raise its benchmark interest rate (BI rate) one more time in 2013 in order to combat the country's current account deficit as well as mitigate the impact of a possible winding down of QE3.

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  • Despite Unchanged BI Rate, Indonesia's Stock Index and Rupiah Down

    Although Indonesia's benchmark interest rate (BI rate) was kept at the level of 7.5 percent (in line with market expectation) today (12/12), it was not able to support the country's stock index. Indonesia's IHSG index fell 1.39 percent to 4,212.22 points. The index was negatively impacted by Asian stock indices that were down due to concerns about the looming end of the Federal Reserve's quantitative easing program. This made investors' positive reaction to the BI rate of temporary nature. Weak openings in Europe increased downward pressure.

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