Executive Director of the BI Communications Department Erwin Haryono, in his official statement in Jakarta, Tuesday, stated that the increase in the foreign exchange reserve position in January was influenced by the issuance of the government's global bonds as well as tax and service revenues, among other things.
The position of foreign exchange reserves is equivalent to financing 6.1 months of imports or six months of imports and servicing the government's foreign debt, and is above the international adequacy standard of around three months of imports.
The central bank assesses that these foreign exchange reserves are able to support external sector resilience and maintain macroeconomic and financial system stability.
Going forward, BI views that foreign exchange reserves will remain adequate, supported by stability and maintained economic prospects, along with various policy responses in maintaining macroeconomic and financial system stability to support the process of national economic recovery.
Earlier, BI Governor Perry Warjiyo stated that foreign exchange reserves were important as self-insurance capital against global turbulence, so that Indonesia would maintain adequate foreign exchange reserves through foreign exchange reserve management reforms.
"We need to have sufficient foreign exchange reserves for self-insurance. Foreign exchange reserves are self-insurance against global turbulence," Warjiyo stated at the BI Annual Investment Forum 2023 monitored online in Jakarta, Thursday (Jan 26).
Global economic turbulence in 2023 encompasses slowing global economic growth, wherein a recession is likely to occur in the United States (US) and Europe, high global inflation, high and longer-lasting interest rates, a strong US dollar, and geopolitical tensions, among other things.
The global economic slowdown is expected to continue in 2023, so BI has lowered its projection for world economic growth in 2023 to 2.3 percent, from the earlier forecast of 2.6 percent.
Related news: Weak rupiah may pull down forex reserves: economist
Related news: Indonesia's forex reserves fall to US$130.8 billion in September