REPUBLIKA.CO.ID, JAKARTA -- Bank Indonesia (BI) stated, the rise in US interest rates was responded positively by the market. In fact, the rupiah strengthened after the decision was made in FOMC meeting on 6th December 2015.

Executive Director of Department of Economic and Monetary Policy of Bank Indonesia Juda Agung said, trading in foreign exchange market on Thursday (17/12) showed that increase in US interest rates was already priced-in by the market. The rupiah also moved relatively higher in opening trade on Thursday.

"It's like what we expected. Response of global financial markets is also positive in terms of stocks and other financial assets," he explained, in a press conference at the headquarters of Bank Indonesia, Jakarta, Thursday (17/12).

Thus, he considered the impact of the Fed's monetary policy to Indonesia's financial condition was good and in line with central bank estimation. For 2016, BI saw a dot plot of FOMC of 100 basis points, although the market expected 50-75 basis points.

"Market is more dovish than the Fed," he added.

Other increases of FFR, he said, would depend on a statement by The Fed President Janet Yellen who have stated the increase would be gradually and based on dependent data. Yellen also said she would communicate carefully, not to cause the sentiment in the market.

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