Monetary stance: Indonesia after the peak of COVID-19
Bᴀɴᴋ Iɴᴅᴏɴᴇsɪᴀ: Mᴀɪɴᴛᴀɪɴ ᴛʜᴇ ʀᴇᴄᴏʀᴅ-ʟᴏᴡ BI7DRR ᴏꜰ 3.5%
𝐒𝐭𝐚𝐛𝐢𝐥𝐢𝐭𝐲
Bank Indonesia (BI) Board of Governors (BOG) monthly meeting July last week (7/21) had decided to keep the reference rate unchanged at 3.5%, for the 18th month since February last year. Post COVID-19 pandemic peak, the current reference rate stance communicates confidence that main factors of economic growth as contained in the profiles of IDR exchange rate, and of inflation level, are in-checked.
The dissemination of credence is especially important during the recovery phase of COVID-19 pandemic time, declared the first time in the last quarter 2021. The dynamic of unprecedented events afterwards have put many countries including Indonesia being exposed to risks that have put additional threats in the recovery process.
𝐀𝐥𝐬𝐨 𝐫𝐞𝐟𝐥𝐞𝐜𝐭𝐞𝐝 𝐢𝐧 𝐭𝐡𝐞 𝐜𝐨𝐮𝐧𝐭𝐫𝐲’𝐬 𝐒𝐨𝐯𝐞𝐫𝐞𝐢𝐠𝐧 𝐂𝐫𝐞𝐝𝐢𝐧𝐠 𝐑𝐚𝐭𝐢𝐧𝐠𝐬
As stated by the country’s Financial Services Authority (OJK or “Otoritas Jasa Keuangan”), 3 (three) major agencies have issued affirmations on favorable status for Indonesia Sovereign Creding Ratings. Moody’s affirmed Indonesia rating at Baa2 on February this year (since April 2018), and Fitch at BBB on June this year (since September 2018). Meanwhile, Standar&Poor’s on April this year maintained its investment grade of BBB rating (since May 2019) for Indonesia and revised the outlook to Stable from Negative.
Cheers,