This BI Six New Policy
Bank Indonesia issued six new policies are strengthening monetary management and financial market development as a step response and anticipation of the dynamics of domestic and global financial markets.
According to the Acting Governor of BI Nasution at a news conference on Building the BI, Wednesday (06/16/2010), overall the policy is carried out to improve the effectiveness of monetary policy transmission, strengthen the financial system stability, and encourage the deepening of financial markets, which in turn supports sustainability strengthen macroeconomic stability and economic recovery.
“This policy is not an exchange control and remain in the corridor of free foreign exchange system that consistently adhered Indonesia so far,” said Nasution confirmed.
According to Nasution, this policy can not be separated from the next economic dynamics that are still faced with several challenges. From the external side, the challenges, especially related to the increasingly rapid flow of overseas capital into emerging economies, including Indonesia. “While the current economic recovery and the vulnerability of potential instability in global financial markets are still very high,” he said.
From the domestic side, the challenges are still associated with high excess liquidity in the banking, portfolio capital flows are still big in the structure of capital flows among the various structural problems in the real sector.
According to Nasution, the Board of Governors of Bank Indonesia decided this policy package as well as the continuation of the policy extension of the maturity profile (maturity profile) Securities of Bank Indonesia (SBI), which became fully implemented in June.
He explained that the package of measures taken in general form of operation of monetary policy to strengthen and improve the prudential aspects of banking, consisting of the addition and completion of several provisions of the instrument both in rupiah and foreign exchange markets. The policy covers:
1. Corridor widening the interbank money market interest rate O / N, which will be implemented starting June 17, 2010.
2. Application of the minimum holding period of one month Bank Indonesia Certificates (SBI) that will be implemented starting July 7, 2010.
3. Additional non-monetary instruments in the form of term deposit securities which will apply from July 7, 2010.
4. Completion of the requirements on net open position (NOP) with effect from July 1, 2010.
5. Publishing SBI of 9 months and 12 months to be implemented on the second week of August 2010 (9-month SBI) and the second week of September 2010 (SBI 12 months).
6. Application of three mechanisms party repurchase agreement (repo) Government Securities (SBN), which will be implemented in 2011.