Finance Minister Purbaya Yudhi Sadewa dismissed the notion that the rupiah's depreciation is triggered by concerns over compromised independence of Bank Indonesia (BI). This comes amid discourse about filling the BI Deputy Governor position with Deputy Finance Minister Thomas Djiwandono.
"People are speculating that BI's independence will be lost. I don't think it will be like that," stated Purbaya after a meeting with the House of Representatives (DPR) in Senayan, Jakarta, on Monday (Jan 19).
Purbaya indicated the rupiah has the potential to strengthen alongside an increasing supply of US dollars domestically. According to him, a rupiah recovery requires an inflow of foreign capital, as it cannot be driven by domestic players alone.
"It's impossible for domestic forces alone to push it to that level. So, it's just a matter of time before the rupiah strengthens as dollar supply increases," he said.
Purbaya affirmed the government will ensure liquidity in the financial system remains secure. He stated that government spending realization will be accelerated, particularly early in the year.
"If liquidity in the system is sufficient, the real sector usually runs. After that, we will improve investment," he explained.
He assessed that the economic growth target of 6 percent is achievable this year. According to Purbaya, incoming foreign capital reflects market confidence in the national economic prospects and the government's policy direction.
Writer: Rahma Nayali Producer: Dena Novita #TirtoRecap
