Official Reserve Assets High Enough in June 2018: BI

Jakarta, MINA — Indonesia`s official reserve assets at the end of June 2018 were quite high at US$119.8 billion although lower than $122.9 billion at the end of May 2018.

“The position of reserve assets was equivalent to financing of 7.2 months of imports or 6.9 months of imports and servicing of government external debt, well above the international standard of reserve adequacy of three months of imports,” Agusman, head of Bank Indonesia`s (BI`s) communications department, was quoted by Antara News as saying in a statement here on Tuesday.

BI considers the position of official reserve assets as being able to support the external sector resilience and maintain macroeconomic and financial system sustainability.

The decline in reserve assets in June 2018 was mainly due to repayment of the government external debt and rupiah stabilization in the midst of continued high uncertainty in the global financial market.

Going forward, BI considers the official reserve assets to remain adequate, supported by confidence in stability and the upbeat outlook for the domestic economy as well as positive export performance.

President Joko Widodo had earlier decided to keep the 2018 state budget deficit at 2.12 percent of the gross domestic product (GDP) as compared to 2.19 percent as projected earlier, Finance Minister Sri Mulyani stated.

“Based on the current outlook, we predict the 2018 state budget to record a deficit of 2.12 percent of the GDP, or Rp314 trillion, lower than the projected Rp325 trillion,” Sri Mulyani stated.

The budget deficit declined in the first half of this year, she noted.

“For the first time in four years, our state budget has recorded a deficit of Rp110 trillion compared to Rp175 trillion last year,” she added.

The decline in budget deficit reflects the government`s efforts to make the state budget sound and credible when it comes to debt management, she remarked.

“The first semester performance confirms that the government is very cautious and prudent to maintain the 2018 state budget,” she revealed.

She explained that President Widodo has made assurance of no revision in the 2018 state budget, as it had a good outlook.

In addition, it has not experienced significant deviation in terms of state revenues and expenditures and had lower deficit than expected. (T/RS5/RS1)

Mi’raj Islamic News Agency (MINA)