Friday, 10 July 2020 | 17:46 WIB

BI Governor: Current Economic Situation Different from 2008, 1998 Crises

BI Governor: Current Economic Situation Different from 2008, 1998 Crises (special)

JAKARTA, NETRALNEWS.COM - The coronavirus disease 2019 or Covid-19 has created a devastating effect on global economic conditions, including in Indonesia. However, the economic slowdown that occurred due to this outbreak is certainly different from the conditions of the 2008 global financial crisis and the Asian monetary crisis in 1998.

Perry Warjiyo, Governor of Bank Indonesia (BI) said the current conditions stem from a humanitarian aspect due to the COVID-19 pandemic, which then impacts the global economic and financial sectors.

"The faster in overcoming the COVID-19 pandemic, the impact on the economic and financial sectors will be minimized," Perry said.

He also ensured that the impact of the weakening of the Indonesian rupiah on inflation was minimal. Inflation is believed to remain under control due to the availability of sufficient supply, and also the impact of the output gap on low inflation.

Not only that, inflation control is also supported by the credibility of monetary policy to ensure price stability and the inflation target (3+1%) is achieved, including through coordination with TPIP and TPID. Perry also believes that the current weakening of the rupiah is temporary due to global panic.

Perry added that Bank Indonesia would continue to coordinate closely in carrying out these steps with the Financial System Stability Committee (KSSK), including strengthening the Crisis Management Protocol (PMK).

In addition, BI will also continue to strengthen its coordination with the Government and the Financial Services Authority (OJK) to closely monitor the dynamics of the spreading of COVID-19 and its impact on the Indonesian economy from time to time, as well as further policy coordination steps that need to be taken to maintain macroeconomic and financial system stability, and ensuring Indonesia's economic growth remains good and resilient.