JAKARTA. BI (the Central Bank) recorded that Indonesia’s foreign exchange reserves increased by 9.8% from US$ 105.93 billion in December 2015 to US$ 116.4 billion in December 2016. However, the increase in foreign exchange reserves was mainly contributed by hot money. In December 2016, the issuance of global bonds worth US$ 3.5 billion contributed the most to the increase in foreign exchange reserves in that month. The foreign exchange rise was also supported by foreign capital inflow to financial market, such as stocks and bonds markets. Economist of Bank Permata Josua Pardede recorded, along the year of 2016, foreign investors booked as much as US$ 754 million net buy in bonds market. The stable capital outflow reduction in stock market also contributed to the increase in foreign exchange reserves.
Hot Money Boosted 2016 Foreign Exchange Reserves
JAKARTA. BI (the Central Bank) recorded that Indonesia’s foreign exchange reserves increased by 9.8% from US$ 105.93 billion in December 2015 to US$ 116.4 billion in December 2016. However, the increase in foreign exchange reserves was mainly contributed by hot money. In December 2016, the issuance of global bonds worth US$ 3.5 billion contributed the most to the increase in foreign exchange reserves in that month. The foreign exchange rise was also supported by foreign capital inflow to financial market, such as stocks and bonds markets. Economist of Bank Permata Josua Pardede recorded, along the year of 2016, foreign investors booked as much as US$ 754 million net buy in bonds market. The stable capital outflow reduction in stock market also contributed to the increase in foreign exchange reserves.