JAKARTA (Yosefardi) – Bank Indonesia has on Friday (August 23) issued five policies expected to boost the supply of foreign exchange as well as financial market deepening.
The policies are:
1) Extension of tenors of foreign exchange deposits to 1 day to a maximum of 12 months from 7-30 days previously.
2) Loosening up foreign exchange-buying restrictions for exporters selling forex from export proceeds (DHE).
3) Adjusting the provision on forex swap for banks that is treated as a pass-on bank transaction with their counter parties.
4) Relaxing foreign debt provisions, by extending the number of exemptions for short-term foreign debt, consisting of rupiah demand deposits (VOSTRO) for non-residents holding proceeds from divestments of direct investments and buyers of Indonesian shares and or corporate bonds as well as tradable government securities (SBN).
5) Issuing Bank Indonesia Deposit Certificates (SDBI) to provide more room for banks to manage rupiah liquidity through tradable instruments, which in turn leading to financial market deepening.
Rupiah, however, closed lower Friday with BI’s mid rate of Rp10,848/USD, weaker than Rp10,451 on Monday and Rp10795 on Thursday.