BI denies letting rupiah weaken against dollar

Jakarta (ANTARA News) - Bank Indonesia (BI) denied on Tuesday that it let the rupiah weaken against the dollar to boost export-led growth.

"It is not true (that BI has let the rupiah weaken). BI remains committed to maintaining the stability of the rupiah in accordance with fundamentals," BI Deputy Governor Perry Warjiyo said.

Perry explained that the rupiah weakened against the dollar due to numerous factors, including the dollars appreciation that saw currencies in the rest of the world corrected.

"Besides the US Federal Reserves plan to raise the Fed Fund Rate, the dollar has strengthened due to the robust growth of the US economy," he added.

The rupiah also came under pressure after the European Central Bank and Bank of Japan injected monetary liquidity, he pointed out.

The other cause of the rupiahs depreciation was the countrys continuing current account deficit, he stated.

"The current account deficit, which reached 3.3 percent (of the GDP) in 2013, stood at 3 percent in 2014. It can be kept down to 2.8 percent this year if there is no capital import. Yet, BI believes the 3 percent deficit is still okay because it is better than consumption to capital expenditure," he remarked.

According to the JISDOR BI rate, the rupiah lost another ground on Tuesday, falling to Rp13,059 from Rp13,047 per dollar the day before. (*)