"That means, in terms of the economy, we have to see how sensitive it is to economic activity," Sri Mulyani stated after the Ministry of Tourism`s III National Coordination Meeting (Rakornas) in Jakarta on Thursday.
The former managing director of the World Bank explained that the Fed`s rate increase would soon be known. Next year, it is estimated that the US interest rate increase will be doubled.
Sri Mulyani also explained that the government will continue to improve Indonesia`s balance of payments by balancing the components of the current transaction and capital transactions.
It is intended that activities of fluctuating exchange rates as well as foreign exchange reserves can be maintained to ensure stability in the future.
"We will assume that this is a fairly normal reaction from the changes that have occurred. However, we will maintain the changes, so that they will not create too much volatility that will disrupt stability," the minister remarked.
Previously, the Fed, on Wednesday (Sept 26) raised its short-term interest rates by 25 basis points, and it was the third interest rate increase this year.
Solid economic growth and a fall in unemployment rate tend to keep the Fed on a stable path towards tightening monetary policy to prevent the US economy from overheating, analysts noted.
Fed officials estimate another interest rate increase this year. Most market participants estimate that the central bank will raise interest rates again during the December policy meeting.
Reporting by Calvin Basuki
Editng by Yoseph Hariyadi
Reporter: Antara
Editor: Andi Abdussalam
Copyright © ANTARA 2018
