"Based on the agreement between BI and the Finance Ministry, if the market cannot absorb (SBNs) BI will buy (the bonds) in the primary market,” BI Governor Perry Warjiyo said during an online press briefing in Jakarta on Thursday.
During the January-March period this year, Rp22.9 trillion of SBNs were purchased through the main auction mechanism and Rp42.13 trillion through the greenshoe option, he informed.
BI also bought bonds worth Rp8.5 trillion out of the bonds worth Rp19.6 trillion released by foreign investors to maintain stability in the SBN market, he added.
The purchase of SBNs is part of the synergy with the fiscal authority to aid national economic recovery, liquidity in the banking industry, and maintain loose financial markets, BI said.
The central bank had purchased SBNs worth Rp473.42 trillion from the primary market to finance the 2020 state budget and support various government programs to contain the impact of the COVID-19 pandemic.
The synergy in the purchase of SBNs will last until December 31, 2021 to finance the state budget, in accordance with the joint decree issued by the Finance Ministry and the BI Governor on December 11, 2020.
Since 2020, as part of quantitative easing measures, BI has injected Rp776.87 trillion into the banking sector, or some 5.03 percent of the gross domestic product. The figure comprises Rp726 trillion released in 2020 and Rp50.03 trillion in 2021 (as of March 16, 2021).
Related news: BI buys Rp40.77 trillion in government bonds to help finance budget
Related news: BI buys Rp342.52 trillion worth of government's sovereign debt papers
Related news: BI envisions economy in 2021 first-quarter to grow stronger