RI`s forex reserves reach $112 bln in January

This figure represents an increase of about US$2 billion, compared to US$110.123 billion in the year ended December 31, 2011.
Jakarta (ANTARA News) - Indonesia`s foreign exchange reserves as of January 31, 2012 stood at US$112 billion, enough to finance imports and foreign debt repayments for 6.2 months, according to the central bank.

This figure represents an increase of about US$2 billion, compared to US$110.123 billion in the year ended December 31, 2011, head of Bank Indonesia`s Public Relations Bureau Difi A Johansyah said here on Thursday.

Quoting the results of a meeting of the bank`s board of governors, Difi said the country`s balance of payment in the first quarter of 2012 was expected to record a surplus, though revealing a lower trend.

However, current transactions were expected to suffer a deficit, along with declining export growth, though imports would remain high thanks to strong domestic demand.

The surplus of the first-quarter balance of payment would be fueled by capital and financial transactions owing to foreign direct investment (FDI) inflows and an investment portfolio which were expected to increase as a result of strong fundamentals of the domestic economy amidst global economic uncertainty, Johansyah said.

Also, the attainment of the investment grade was expected to strengthen positive sentiment towards the Indonesian economy, he said.

On the domestic side, the central bank`s board of governors believes the Indonesian economy still has strong resistance to the global crisis, though it would grow at a slower pace amidst the declining prospects within the global economy.

He noted that the Indonesian economy was projected to expand 6.5 percent in the first quarter of 2012. In 2012, domestic economic

growth was expected to hit the lower level of the economic growth forecast of 6.3-6.7 percent.

The 2012 economic growth would be fueled by strong household consumption and investment. This strong household consumption would be driven by high purchasing power thanks to the government`s effort to control the inflation rate, Johansyah said.(*)

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