BI believes rupiah depreciation be temporary

Jakarta (Antara News) - Bank Indonesia believes current depreciation of the country`s currency, the rupiah, will be only temporary.

"As it is only temporary do not say that it will drag on," the the spokesman of the central bank, Budi Mulia, said here on Wednesday.

The rupiah was down 80 points against the US dollar closed at Rp9,150/Rp9,160 per dollar that day from Rp9,070/Rp9,092 the day before.

Budi Mulia said Bank Indonesia (BI) would keep monitoring the rupiah and would always be in the market.

"What is certain is the development that we saw today was the impact of the event in China as well as pressures in the New York market," he said.

BI`s deputy governor Aslim Tadjudin said before BI was optimistic it could maintain the rupiah at between Rp9,000 and Rp9,500 per US dollar this year.

Coordinating minister for the economy Boediono meanwhile said a sharp fall in the rupiah and the Jakarta Stock Exchange Composite Index (IHSG) that day was the impact of global markets such as in China and Hong Kong.

He gave the assurance that the government would continue to implement the policy that it had made and would consider the phenomena still controlable.

He said China`s economy was overheating so that various adjusments were needed.

"This may be one of the measures to cool down their economy," he said.

Finance Minister Sri Mulyani meanwhile said there was nothing to worry about in connection with the development because the country`s fundamental factors remained quite good.

"No fundamental factors linked to corporatations and capital market seems to have caused the drop in the IHSG. Therefore, we need not worry," she said.

She said efforts to improve the capital market and corporate condition would continue to be made.

The IHSG was closed at 1,740.971 on Wednesday, down 23.031 points from the previous day`s close of 1,764.008. (*)
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