March 27, 2025 | 03:08 pm
TEMPO.CO, Jakarta - Indonesian officials will seek to address concerns among investors and other key economic players about an economic downturn in Southeast Asia's biggest economy following a stock market selloff and currency slump, an official said on Thursday.
President Prabowo Subianto will meet with investors and others following the long Eid-al-Fitr holiday, which begins on Friday, aiming to correct misperceptions about the government's policies, said Raden Pardede, a special aide to Indonesia's senior economic minister Airlangga Hartarto.
"The government will improve and intensify communication with economic players," Raden told Reuters.
The rupiah has fallen to its weakest since 1998, following a slide of as much as 7.1% in the main stock index last week, pressured by concerns over government policy, the country's fiscal position and its growth prospects.
Analysts mentioned poor government communication on fiscal policies and strategies to achieve growth as one of the selloff triggers, in addition to pressure on the market from negative global sentiment.
Key messages will include assurances that the government will not break the legal fiscal deficit ceiling at 3% of GDP and there will be no political interference in the newly set up sovereign wealth fund Danantara Indonesia, Raden said.
"We are also preparing ways to deregulate the real sector, mainly to encourage the manufacturing industry, which creates jobs and is export-oriented," he said referring to a policy that seeks to make available 20 trillion rupiah ($1.21 billion) in credit for labour-intensive industries.
The government and financial authorities will also provide more investment instruments to attract investors and will ensure the quality of companies listed on the stock exchange, finance ministry spokesperson Deni Surjantoro told Reuters.
Bank Indonesia said it is ready to continue its intervention to stabilise the currency, but said economic indicators show the country is fundamentally strong and the situation is "totally different" from 1998 financial crisis.
On Thursday, the rupiah strengthened as much as 0.24% against the dollar. It has rebounded since Wednesday with BI citing positive sentiment in stocks, bonds and FX markets. The current level at around 16,500 is still near 1998's level of 16,800.
After stocks tumbled last week, the financial regulator eased buyback processes, and the market has since recovered.
"Markets will keep an eye on the mid-year budget update to gauge if the shortfall in revenues has narrowed or further spending rationalisation is required to keep within the 3% of GDP deficit threshold," DBS Bank economist Radhika Rao said in an e-mail.
The mid-year budget update is usually handed down in early July.
Rao said a long holiday will provide a break to the market, which will be shut from March 28 to April 7.
($1 = 16,545.0000 rupiah)
REUTERS | By Stefanno Sulaiman
Editor's Choice: Rupiah Plunges to Lowest Level Since 1998, BI Assures No Monetary Crisis Ahead
Click here to get the latest news updates from Tempo on Google News
Prabowo's Style of Command Economy
30 menit lalu
The appointment of military personnel to Agrinas confirms Prabowo Subianto's militaristic thinking while undermining economic democracy.
2026 World Cup Qualifiers: Branko Ivankovic Sees Indonesia vs China as Key Match
1 jam lalu
According to Ivankovic, China's chances of qualifying for the World Cup are still open. The Indonesia vs China match will take place in Jakarta on June 5, 2025.
Rupiah Plunges to Lowest Level Since 1998, BI Assures No Monetary Crisis Ahead
4 jam lalu
Bank Indonesia (BI) declares that the current depreciation of the rupiah is still within reasonable limits compared to other countries in the region.
World Cup Qualifiers: Calvin Verdonk Confident in Indonesia's Potential to Beat Qualifying Japan
6 jam lalu
According to Indonesia national team player Calvin Verdonk, the fact that Japan have already qualified means they may not display their full strength in the remaining matches.
Govt to Establish Transmigration Zone in Rempang
10 jam lalu
Minister of Transmigration Muhammad Iftitah Sulaiman Suryanagara stated that President Prabowo has approved the plan of thRempang transmigration zone.
Apple Says iPhone 16 Series to Be Available in Indonesia From April 11
19 jam lalu
Apple announced on Wednesday that its iPhone 16 series will be available in Indonesia from April 11, 2025.
Bank indonesia Says Ready to Stabilize Rupiah, Which is Near 27-Year Low
19 jam lalu
Bank Indonesia said it is ready to intervene to stabilize the rupiah as it plunges.
Prabowo Orders State-Owned Banks to Cut Commissioners, Keep Only Professionals
19 jam lalu
Prabowo asks state-owned banks to reduce the number of their commissioners. Airlangga Hartarto mentions that BRI and Mandiri received the instruction.
Indonesia Steps Up Handing Confiscated Palm Plantations to State Company
20 jam lalu
Indonesian authorities will hand over more land that has been seized in probes into illegal palm plantations to new state company Agrinas.
Today's Top 3 News: Indonesia Beats Bahrain 1-0 in 2026 World Cup Qualifiers
21 jam lalu
Here is the list of the top 3 news on Tempo English today.
