The decision was made in view of macro-economic development and especially to maintain internal stability or inflation and external stability or balance of payment, the central bank`s spokesman, Difi A Johansyah, said.
He said the Board of Governors viewed the strengthening of the macro-prudential policy towards foreign capital inflows remained important to minimize the risk of capital reversal and to help the rupiah exchange rate to move in line with that of other currencies in Asia.
Bank Indonesia would continue monitoring inflationary pressures especially those that come from international commodity prices, increasing domestic demand and the government policy on subsidized fuels and its possible impact on food supplies.
The central bank will also continue to strengthen the implementation of a combination of monetary and macro-prudential policies including through liquidity control and response to interest rate to maintain macro-economic stability and bring inflation down to meet the target set at 4 to 6 in 2011 and 3.5 to 5.5 in 2012.
BI governors viewed that the domestic economy had grown stronger. In the first quarter it grew 6.5 percent year-on-year, driven especially by good export performance and increasing investment, he said.
Bank Indonesia believed the strong economic growth would continue to the second quarter to increase optimism in the achievement of growth to reach the upper ceiling or projected range of 6.0 to 6.5 percent in 2011.
Exports are expected to remain the driver of growth besides investment that will continue to increase and consumption that will remain sound, he said.
Sectorally in the second quarter growth will be driven by indrustial, transportation, communications and financial sectors, he said. (*)
(H-YH/HAJM/a014)
Editor: Ruslan Burhani
Copyright © ANTARA 2011
