- Indonesia’s FX reserves increased by USD 0.7 Bn last month, bringing it up to USD 137.1 Bn. This was driven by government debt issuance as well as a surge of capital inflows in June.
- Markets however, have since remained in a holding position as they await further details on the Fed’s tapering timeline.
- Unfortunately, these tighter global monetary conditions coincide with potentially higher financing needs for the Indonesian government as the Covid crisis continues.
- All these, as well as higher oil prices, would present several risks for the Rupiah going forward.
