Indonesia Introduces New Instrument to Lure Exporter's Earnings

By Editorial Team 27/12/2022
Dollar Indonesia
Summary

Bank Indonesia (BI) has just launched a new monetary instrument for foreign currencies as an attempt to send back export proceeds (DHE) stored in Singapore. BI governor Perry Warjiyo assured the instrument would provide competitive returns on foreign currency deposits based on the market mechanism. "Banks can pass on DHE deposits from exporters. So exporters can deposit their proceeds in banks, and banks can pass on to BI with the market mechanism and attractive interest rates or yields," Perry said in a press conference on Saturday.

For example, if the average interest on foreign currency deposits is 3.70 percent, BI will offer the banks an interest rate in the 3.75-4.0 percent range through an auction. "Banks will still get the spread. Depending on conditions, it will move from time to time because the market mechanism matches existing developments with interest rates and the attractiveness of exporters for this," Perry said.

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