US$8.5 billion foreign funds enter Indonesia in past five months

Jakarta (Antara News) - Foreign funds totaling US$8.5 billion have entered Indonesia in the last five months from January through May 2007, a Bank Indonesia official said here on Thursday.

"The funds consist of US$3.96 billion in state bonds (SUN), US$3.2 billion in Bank Indonesia promissory notes (SBI), and US$1.3 billion in stocks," the director of the central bank (BI)`s directorate of strategic planning and public relations, Budi Mulia, said.

In May foreign ownership of the SBI reached US$6 billion and in the SUN US$9.4 billion, while foreign capitalization in shares US$62 billion, he said.

He said the funds came into the country as a result of global liquidity excess. "They are looking for emerging markets and Indonesia is one of them," he said, adding that this had made the country`s currency to appreciate.

He said the country`s improving economic performance as well as strong foreign exchange reserve and the government`s fiscal recurity had also contributed to the appreciation.

He said although the country`s total foreign exchange reserve was high, totaling Rp50.9 trillion until June 7, Bank Indonesia still continued monitoring the development of the rupiah appreciation.

"We continue maintaining its votatility so that it remains within a controlled range," he said.(*)
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