- Bank Indonesia’s FX reserves declined by USD 4.2 Bn to USD 136.2 Bn in Apr-24. The Rupiah faced a sort of perfect storm in April, as geopolitical tensions escalated and “higher-for-longer” expectations triggered capital outflows.
- The global pressure has eased, and the Rupiah has rebounded. Potential growth slowdown, concerns about slowing consumption, and easing FX demand have reduced the likelihood of another BI-Rate hike in May.
- However, looming concerns arise from the maturity of government bonds in Q2 and Q3, along with further dividend repatriation and continued signs of liquidity stress that may further strain the Rupiah.
