BI Board of Governor's Meeting, January 2019

Febrio Kacaribu (), Syahda Sabrina (), Nauli A. Desdiani () and Nisrina Qurratu’Ain ()
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Febrio Kacaribu: Institute for Economic and Social Research, Faculty of Economics and Business, Universitas Indonesia (LPEM FEB UI)
Syahda Sabrina: Institute for Economic and Social Research, Faculty of Economics and Business, Universitas Indonesia (LPEM FEB UI)
Nauli A. Desdiani: Institute for Economic and Social Research, Faculty of Economics and Business, Universitas Indonesia (LPEM FEB UI)
Nisrina Qurratu’Ain: Institute for Economic and Social Research, Faculty of Economics and Business, Universitas Indonesia (LPEM FEB UI)
Authors registered in the RePEc Author Service: Nisrina Qurratu'Ain

No 201901, LPEM FEBUI BI Board of Governor Meeting Brief from LPEM, Faculty of Economics and Business, University of Indonesia

Abstract: Better than expected budget deficit in 2018, amidst the widening current account deficit, has positively affected the market sentiment and helped Rupiah to appreciate to around 14,000 level. Rupiah is now among the strongest emerging market currencies since October 2018 as portfolio investments are coming back, despite the Fed rate hike last month. The Fed’s dovish policy stance and US-Tiongkok trade war potential truce have helped the global investors to start looking at the emerging economies’ assets again. Inflation, on the other hand, is still subdued, signaling slow and steady consumption, partly due to higher interest rate in 2018. Considering the stable domestic fundamentals, the implementation of negative Tobin Tax, and the diminishing external risks, we are of the opinion that Bank of Indonesia should hold its policy rate this month.

Keywords: gdp; —; economic; —; economic; outlook; —; inflation; —; macroeconomics; —; interest; rate (search for similar items in EconPapers)
Date: 2019-01, Revised 2019-01
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