Indonesia's Central Bank Poised for Aggressive Market Intervention

Bank Indonesia plans aggressive interventions in domestic foreign exchange and bond markets, resuming after a public holiday break. The move, in response to new U.S. tariffs, aims to stabilize the rupiah, which has fallen to its lowest level since 1998. The bank will also optimize rupiah liquidity instruments.

In response to recent U.S. tariff announcements, Indonesia's central bank has announced a robust plan to aggressively intervene in the domestic foreign exchange markets. This move comes as Southeast Asia's largest economy gears up to reopen trading on April 8, following an extended public holiday.

The Indonesian rupiah has been under significant pressure, sliding to its weakest point since the 1998 financial crisis prior to the market closure on March 28. Bank Indonesia's strategic interventions will encompass the spot market, non-deliverable forward markets, and secondary bond markets, with actions already underway in offshore markets including Asia, Europe, and New York.

Aimed at stabilizing the volatile rupiah and reinforcing investor confidence, the central bank will also focus on optimizing rupiah liquidity instruments to ensure adequate liquidity within the money market and domestic banks.

(With inputs from agencies.)