Indonesia's foreign exchange reserves fell for the fifth consecutive month, reaching $144.9 billion, after the central bank intervened in the market to prop up the rupiah, which had weakened to a new record low.
June 8, 2569 at 10.02:XNUMX a.m. Bloomberg News reported that Indonesia's foreign exchange reserves declined for the fifth consecutive month in May. This reflects the increased costs incurred by authorities' efforts to stabilize the rupiah after it weakened to a record low against the US dollar.
Bank Indonesia Government reserves fell to $144,900 billion in May, marking the longest continuous decline since 2561.
The central bank stated that the decline in reserves was primarily due to the government's repayment of foreign debt, as well as intervention in financial markets to support the rupiah amid volatility and uncertainty in global financial markets.
The rupiah weakened further by 0.7% on Monday, hitting a new low against the US dollar, as Indonesia's 10-year government bond yield rose 26 basis points to 7.14%, its highest level since April 2568.
The Jakarta stock market index fell 2.5%, in line with selling pressure in stock markets across Asia.
This decline in reserves comes as the Indonesian central bank intensifies its intervention in the money and bond markets to curb the depreciation of the rupiah, which has fallen by approximately 8% since the beginning of the year.
Meanwhile, foreign investors have been net sellers of Indonesian stocks by more than $3,500 billion this year, causing the Jakarta stock market index to plummet by more than 30% due to concerns about the economy and capital flows.
In an effort to boost foreign investor confidence, Indonesia's central bank and the government announced on Saturday that they would cooperate on measures to attract capital inflows. The central bank plans to raise the return on government deposits held with the central bank, which would reduce government borrowing costs and increase the attractiveness of Indonesian assets.
However, the central bank affirmed that current reserve levels remain strong, sufficient to support imports and foreign debt repayments for approximately 5.5 months, which is adequate for maintaining external stability and the security of the country's financial system.
refer : bloomberg.com
