"The decision is consistent with ongoing efforts to reduce the current account deficit to a manageable threshold and maintain the attractiveness of domestic financial assets," BI Communications Director Agusman said in a statement here on Thursday, Jan 17.
Furthermore, BI continues monetary operations strategy to maintain adequate liquidity in the Rupiah money market and foreign exchange market in order to support monetary and financial system stability.
Moving forward, BI will continue to optimize its policy mix and strengthen coordination with the government and other relevant authorities in order to maintain economic stability and strengthen external sector resilience, which entails controlling the current account deficit within the threshold of 2.5 percent of GDP in 2019.
Meanwhile, Global economic moderation is continuing despite slightly less uncertainty.
In terms of the advanced economies, economic consolidation is expected in the United States during 2019 due to a tightening in the labor market and constrained fiscal space.
The US Federal Reserve's dovish monetary stance is forecast to reduce the pace of Federal Funds Rate (FFR) hikes.
Europe`s economy is also predicted to moderate in 2019, which could seriously impact the speed of monetary policy normalization by the European Central Bank (ECB).
In terms of developing economies, China's economy is decelerating on sluggish consumption and flagging net exports due to simmering trade tensions with the United States as well as the reverberations of the ongoing deleveraging process.
Affected by the global economic outlook, international commodity prices are expected to slide, including the global oil price as the United States ramps up production.
Reporter: Antara
Editor: Azizah Fitriyanti
Copyright © ANTARA 2019
