Hence, the stimulus injection is high enough to the GDP as is indicated by the quantitative easing from the central bank that reached 5.06 percent of the GDP. Regionally, our liquidity injection is recorded as one of the highest.
Jakarta (ANTARA) - Bank Indonesia (BI) claimed highest liquidity injection among regional countries, totaling Rp781.29 trillion, or 5.06 percent of Indonesia’s gross domestic product (GDP), to aid fund supply in the financial market to facilitate national economic recovery.

The stimulus injection was started since 2020 or when the COVID-19 outbreak globally occurred until today.

“Hence, the stimulus injection is high enough to the GDP as is indicated by the quantitative easing from the central bank that reached 5.06 percent of the GDP. Regionally, our liquidity injection is recorded as one of the highest,” Deputy Governor of BI Dody Budi Waluyo highlighted during an online discussion on “Improving the Effectiveness of National Economic Recovery” here on Thursday.

The liquidity injection was conducted through monetary operation with repurchase agreement between the banks and central bank. BI is keen to ensure loose liquidity at banks in order that its intermediation function in the economy can run smoothly, he explained.

Apart from liquidity easing, BI has endeavored to issue a policy pertaining to lowering the benchmark interest rate since 2020, he pointed out.

In total, the BI-7 day reverse repo rate was cut six times to 3.5 percent, recorded as the lowest level in history.

“It was a loose policy that we have applied to boost the nation’s economic recovery. Inflation was well-maintained, so we do not think that this easing monetary policy will affect inflation,” he remarked.

Waluyo emphasized BI’s unwavering efforts in easing liquidity conditions. The monetary policy will be directed at facilitating economic recovery and being synergistic with the government.

“When will we tighten our policy? We will monitor the impact of liquidity on inflation. Seeing the impacts of liquidity on lending remaining too large, we probably will not tighten our policy in 2021. It means our stance remains at ease,” he noted.
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