"The impact of capital outflow is still relatively insignificant. If it is compared with those in Singapore and Malaysia, the one in Indonesia was still better," Perry said.Jakarta (ANTARA News) - Bank Indonesia (BI/the central bank) said capital outflow from one country to another was a normal thing because all countries had such an experience.
"The capital outflow that has taken place of late is not caused by the lowering of the BI benchmark rate from 6.75 percent to 6 percent," BI Director for Monetary Policy Perry Warjiyo said here on Monday.
He said that the capital outflow was purely caused by global factors, not by the lowering of the BI rate by 75 basis points.
Perry said capital outflow was a normal thing to be experienced by a country. After all, the interest rates offered by Indonesia were still very attractive, so is the case of yield which the government was offering.
"The impact of capital outflow is still relatively insignificant. If it is compared with those in Singapore and Malaysia, the one in Indonesia was still better," he said.
In the meantime, BI Governor Darmin Nasution said the majority of foreign exchange reserves or about 55 percent the central bank had now was in the form of US dollar currency.
The foreign exchange reserve composition will also be adjusted to the composition of the government`s debts so that if the government needed certain foreign currencies for paying its debts or installments of its debts, BI would be ready to provide it.
It was earlier announced that the central bank`s foreign exchange reserves amounted to 112 billion US dollars. The amount fell from the October position which was 114 billion US dollars.
BI said that drop in the amount of its foreign exchange reserves was due to its monetary operations it had to take to stabilize the value of the local currency rupiah exchange rate against the greenback.(*)
Editor: Heru Purwanto
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