The financial system of Indonesia remains stable.(Photo: Antara)
Jakarta (VNA) - The financial system of Indonesia remainsstable and the bank intermediation function continues to improve, stated BankIndonesia (BI) Executive Director for Communications Agusman.
According to ANTARA news, Agusman noted in a statement onApril 23 that maintained stability in the financial system is reflected in thehigh Capital Adequacy Ratio (CAR) of the banking industry, reaching 23.1percent, and liquidity ratio, 23 percent, in February 2018.
He remarked that the loosing of the monetary and macroprudential policies waseffectively reflected through the interest rate channel, with the banksinclined to lower their deposit and lending rates by 203 basis points (bps) and155 bps respectively since BI began easing its monetary policy.
The banking industry reported credit growth at 8.2 percent year-on-yearin February 2018, up from 7.4 percent a month earlier.
Earlier, BI projected a stronger deposit and credit growth in 2018 at 10-12percent and 9-11 percent year-on-year, respectively.
Agusman said that improvement in the US economic indicatorswas accompanied by market expectations of an aggressive federal funds rate hikeand increased pressures on the rupiah along with the impending risk of a tradewar between the United States and China. Such inauspicious dynamics triggered acapital reversal and global exchange rate depreciation pressure, including onthe rupiah.
Nonetheless, with BI's stabilisation efforts, controlleddomestic inflation, Indonesia's upgraded rating, and trade surplus that drewnon-resident capital inflows, the rupiah quickly stabilised in the first halfof April 2018, he said.
BI will continue to monitor the build-up of uncertainty andrisks in the global financial market while implementing measures to stabilisethe exchange rate to safeguard the rupiah's fundamental value and maintainmarket mechanisms, he noted.-VNA
VNA
