Bank Indonesia reviews US fiscal policy

Jakarta (ANTARA News) – Bank Indonesia (BI) Governor Agus Martowardojo has continued to review a recent slowdown in the US fiscal policy and its impact on the countrys economic growth.

“The slowdown in the US fiscal policy affects the countrys economic growth. Earlier, the fiscal policy was forecast to be fast in an attempt to boost economic growth,” Martowardojo stated here on Friday.

In addition, the Board of Governors of BI discussed challenges in the US related to the fed funds rate and its plan to normalize its balance sheet.

“The plan will be assessed on the impact on the stability of the financial system in the world,” he remarked.

BI had earlier decided at the Governor Council Meeting held on July 19-20 to keep its benchmark rate, the 7-day reverse repo rate, at 4.75 percent. Meanwhile, the deposit facility rate and lending facility rate were also kept at four and 5.50 percent respectively, effective from July 21.

“We discussed the global and national economy. We generally see that the global economy is still the same as last month, and economic growth in the world will still be the same in the range of 3.3 percent,” Martowardojo pointed out.

However, changes can occur, as economic growth of India and the US was forecast to decline. Meanwhile, the economic growth of Europe and China was assumed to improve, Martowardojo added.

Source: Antara News