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Is Bank Indonesia Doing Anything to Mitigate Climate Change?

A s the host of the G20 Finance Ministers and Central Bank Governors' meeting, Bank Indonesia played a critical role in facilitating discussions and ensuring that concrete agreements were reached. The meeting was held virtually due to the ongoing COVID-19 pandemic and focused on pressing global economic issues, including the pandemic, climate change, and digitalisation. G20 Officials Take Steps to Address Global Economic Challenges During the meeting, the participants took several concrete actions to address these challenges. Firstly, they pledged to continue supporting the global economic recovery from the COVID-19 pandemic by maintaining supportive fiscal and monetary policies while ensuring financial stability (G20, 2022; Bank Indonesia, 2022). Secondly, the participants recognised the importance of addressing climate change. They agreed to work towards a more sustainable future by mobilising finance for green projects, promoting sustainable finance, and increasing transparency ...
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How has Bank Indonesia Contributed to the Liquidity Condition in the Banking Sector?

I n Indonesia, broad money or money supply measures financial liquidity. The money supply is the total currency and bank deposits circulating within an economy. It is a crucial determinant of an economy's health, affecting inflation, employment, and economic growth. (Mahatir et al., 2020; Bank Indonesia, 2023). This blog post will discuss the significance of positive growth in the money supply. December 2022 Report According to the  December 2022 report , Indonesia's money supply increased by 8.1% year-on-year (YoY). This growth was primarily driven by broad money (M2) growth, which increased by 8.2% YoY. On the other hand, narrow money (M1) grew by 6.8% YoY. The report also highlighted the growth of quasi-money, which increased by 11.2% YoY. Quasi money includes savings deposits, time deposits, and certificates of deposit, among others. This growth is a positive sign for the economy, as it indicates that people are saving more and contributing to the growth of the banking sect...

Is Inflation in Indonesia Finally Rolling Over with the Help of Bank Indonesia ?

I nflation has been a significant concern for the Indonesian government and the central bank for several years. However, the efforts of Bank Indonesia seem to be paying off, as recent data shows that inflation may finally be decreasing in January 2023. In this blog post, we will discuss the current state of inflation in Indonesia and the role of Bank Indonesia in controlling it. Bank Indonesia's Efforts Bank Indonesia has been taking several measures to control inflation in the country. One of the most significant steps is raising the benchmark interest rate, which has increased several times in the past few years (Bank Indonesia, 2023). This move has helped stabilise the rupiah and control the rising prices of goods and services. According to Bank Indonesia (2023), The stabilisation of the rupiah, which has improved since December 2022 and is now 2.39% stronger than previously, is an illustration.  Source: Bank Indonesia (Twitter), 2023 Additionally, Bank Indonesia has been implem...

How Bank Indonesia Fights for External Resilience?

B ank Indonesia (BI), the central bank of Indonesia, has been working hard to maintain external resilience in the Indonesian economy. That means ensuring that the country can withstand external shocks and maintain stability in the face of economic challenges outside the country. This blog post will explore two ways Bank Indonesia fights for external resilience. The Use of Foreign Reserves One of the ways that Bank Indonesia is fighting for external resilience is through the use of foreign reserves. Foreign reserves are funds held in reserve by a central bank in foreign currencies, which can stabilise the country's currency and support its financial system during economic stress (Bank Indonesia, 2023). This involves ensuring the country has enough foreign money to pay for imports and external debt obligations. BI has been building up its foreign reserves in recent years, and as of January 2023, it holds  $139.4 billion in foreign reserves (Bank Indonesia, 2023). BI provides an es...