"I believe Bank Indonesia understands it all."Jakarta (ANTARA News) - Minister of Finance Agus Martowardojo has stated that a weakened rupiah, with the currency trading in the range of Rp9,600 to Rp9,700 per U.S. dollar, is no cause for concern because the current figures do not reflect the annual average exchange rate.
"Let us see the annual average. I believe Bank Indonesia understands it all," he said in Jakarta on Tuesday.
Agus pointed out that a weakened rupiah could benefit Indonesia in the short term, because it would lead to increased exports and reduced imports.
"The volume of exports will increase, as exporters will gain from a weakened rupiah, while import volumes will decrease because importers will need to pay more for the same things," he explained.
"If the government could push up the value of exports, that would be positive thing, because Indonesia is currently experiencing a trade deficit of US$1.33 billion," Agus noted.
"Such conditions have never been experienced before in Indonesia. Therefore, we need to step up efforts to not only minimise the influence of external factors, but also have better control over internal factors by keeping our productivity high and increasing our export-import activities," he added.
The rupiah weakened by 5 points to close at 9,660 per dollar, compared with the previous day's close of Rp9,665, as the market is still waiting for the Fed`s decision on US stimulus.
Meanwhile, the rupiah's annual average exchange rate in 2012 was Rp9,384 per U.S. dollar, down 6.9 percent from Rp8,779 per dollar in the previous year.
However, the government expects the rupiah's annual average exchange rate to be Rp9,300 per dollar this year higher than the 2012 budget assumption of Rp9,000 per U.S. dollar.
(U.S038/INE/KR-BSR/A014)
Editor: Priyambodo RH
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