Jokowi Bluntly Says Why Foreigners Withdraw Money from RI News – 29 minutes ago

Jakarta, CNBC Indonesia – President Joko Widodo (Jokowi) revealed that the policy of increasing high interest rates by the United States (US) put developing countries in an increasingly difficult position.

“All the capital outflow is running back to the United States,” said Jokowi, quoted on Sunday (29/10/2023).

Last week, Chairman of the Fed (Federal Reserve System), Jerome Powell, said that US interest rates would be maintained at high levels for a long time.

In addition, Powell gave a signal to hold off on increasing interest rates at the next meeting, but also emphasized that he still has room for increases if the labor market remains tight, which threatens to increase inflation again.

Last week, Bank Indonesia (BI) raised its benchmark interest rate by 25 bps to maintain the rupiah exchange rate and hopes that foreign funds will return to Indonesia in droves.

BI noted that as much as IDR 5.36 trillion of foreign capital outflow from 16 to 19 October 2023. This amount consisted of net sales of IDR 3.45 trillion on the Government Securities (SBN) market, net sales of IDR 3.01 trillion on the stock market, and net purchase of IDR 1.10 trillion in Bank Indonesia Rupiah Securities (SRBI).

BI Executive Director, Erwin Haryono, in his written statement explained that until October 19 2023, non-residents bought a net IDR 51.45 trillion on the SBN market, sold a net IDR 7.26 trillion on the stock market, and bought a net IDR 11.06 trillion on the SRBI.

Meanwhile, the 5-year Indonesian CDS premium as of 19 October 2023 was 100.83 basis points (bps), an increase compared to 95.48 bps as of 13 October 2023.

[Gambas:Video CNBC]

Next Article

Minister Bahlil Admits He Was Wrong About the 3 Period Jokowi Issue