REPUBLIKA.CO.ID, JAKARTA - Bank Indonesia absorbed government bonds (SUN) one trillion IDR from two trillion IDR offered. SUN absorption is targeted to keep the IDR liquidity. Executive Director of Communication Department at BI, Difi A Johansyah said the offer of SUN reached 1.0747 trillion IDR and it is still below the target.
"It was below the target because the owners tend to hold their SUN and not release it to the market," Johansyah said Thursday.
BI absorbs SUN to balance market intervention in order to maintain the exchange rate. The IDR was closed at 9,855 IDR per USD on Wednesday. Meanwhile, at Non-Deliverable Forward or NDF's market this month, IDR reached 10,120 IDR per USD, decrease from 10,400 IDR per USD.
The weakening of IDR has major effect to foreign exchange reserves. When IDR at level of 10,000 IDR per USD, the foreign exchange reserves will eroded to less than 100 billion USD.
"The decline of foreign exchange reserves was caused BI intervened money market. Beside the weakening of IDR, economic phenomenon that should be anticipated was the decline in the stock price index in recent days which dropped about 10 percent," An economists, Lin Che Wei said on Thursday.
On the other hand, BI has finally raised its benchmark of BI rate by 25 basis points, from 5.75 percent to 6.00 percent. This step was taken as part of BI policy to respond inflation expectation and to maintain financial stability.
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