Monetary policy remains pro stability in 2019: Bank Indonesia

Monetary policy remains pro stability in 2019: Bank  Indonesia

Bank Indonesia governor Perry Warjiyo gives a press conference after an annual meeting of the central bank in Jakarta on Tuesday (27/11/2018). (Indra Arief Pribadi)

Jakarta  (ANTARA News) - Bank Indonesia said it will continue to adopt its pre-emptive and ahead-of-the-curve monetary policy in a bid to maintain economic stability amid the high external pressure in 2019.

"We will maintain the pre-emptive and ahead of the curve monetary stance. The focus of the monetary policy will continue on stability especially to control inflation and exchange rate," Governor of Bank Indonesia Perry Warjiyo said in an annual meeting of the Central Bank here on Tuesday.

Perry said based on evaluation of the economy in 2018, the Central Bank would increase its policy mix.

"Although the bank will continue to focus its monetary policy more on stability, its macro-prudential policy , payment system and sharia economy would be accommodated to shore up economic growth," he added.

The pre-emptive and ahead of the curve monetary policy is also aimed at reducing the current account deficit to 2.9 percent of the GDP in 2019, after widening in 2018 as a result of a surge in imports.

Perry pledged while focusing monetary policy on pro-stability , the central bank would seriously seek to maintain adequate liquidity in the financial market.

"Stability would continue to be a priority through double intervention in the foreign exchange market. Adequacy of foreign exchange reserve would be maintained to prop up rupiah stability. Cooperation in swap agreement in the banking sector would be strengthened," he said.

There were three important records evaluated by the Central Bank in 2018 including the strengthening of domestic economic resilience, inflation being kept low, rupiah stability , safe fiscal deficit, and financial system stability.

"Inflation has to be kept relatively low, rupiah has to remain stable, fiscal deficit has to be in safe territory. Current account deficit needs to be made narrower at a safe level," Perry said.

The second evaluation is increase in competitiveness, industrialization , exports and investment. The third evaluation is strengthening synergy . Synergy in national economic policy between institutions and the central government and regional administrations has to be strengthened, he said.
Reporting by Indra Arief Pribadi, A Saragih
Editing by Suharto