JAKARTA - Bank Indonesia (BI) has prepared seven measures to boost the momentum of economic growth as part of the government's efforts to mitigate the risk of the spread of the coronavirus disease (Covid-19).
The measures were announced by BI Governor Perry Warjiyo in a press conference broadcast on BI's official YouTube channel on Thursday (19/3). The seven measures are:
First, strengthening the intensity of the triple intervention policy to maintain the stability of the rupiah exchange rate in accordance with its fundamentals and market mechanism, "in terms of spot, domestic non-deliverable forward (DNDF), and the purchase of SBN (Government Securities) from the secondary market," said Mr Warjiyo.
Second, extending the Government Securities Repo tenure to 12 months and hosting daily auctions to strengthen the rupiah's liquidity easing starting Friday (20/3).
Third, increasing the frequency of FX swap auctions for one-month, three-month, six-month and 12-month tenors from three times weekly to daily to ensure adequate liquidity starting Thursday (19/3).
Fourth, strengthening foreign currency term deposit instruments to improve foreign exchange liquidity management in the domestic market and encourage banks to use a reduction in the statutory reserve requirement for foreign currencies that has been set by BI for domestic needs.
Fifth, accelerating the enactment of provisions on the use of domestic rupiah accounts (Vostro) for foreign investors as underlying transactions in DNDF transactions to encourage more hedging rupiah ownership in Indonesia starting from March 23, 2020.
Sixth, expanding the daily statutory reserve requirement easing in rupiah by 50 basis points (bps), originally intended only for banks that conduct export-import financing, to banks that finance MSMEs and other priority sectors starting from April 1.
Seventh, strengthening payment system policies to support efforts to mitigate the spread of Covid-19 through the availability of hygienic money in circulaltion, encourage the use of non-cash payments, and support the distribution of non-cash funds in government programmes such as the Families of Hope Programme (PKH), Non-Cash Food Assistance (BPNT), and the Employment Card Programme. (MS)