Indonesia Passes Central Bank Bill With Board Removal Mechanism as Rupiah Hits 18,045
Updated
Updated · Reuters · Jun 4
Indonesia Passes Central Bank Bill With Board Removal Mechanism as Rupiah Hits 18,045
3 articles · Updated · Reuters · Jun 4
Summary
Indonesia's parliament approved sweeping legislation that broadens Bank Indonesia's mandate to support growth and lets lawmakers issue binding recommendations to the central bank and other financial regulators.
A new mechanism to remove central bank board members, disclosed by Finance Minister Purbaya Yudhi Sadewa without details, has sharpened concerns that President Prabowo Subianto's 8% growth push could weaken policy independence.
Market pressure has already intensified: the rupiah fell more than 7% this year to a record 18,045 per dollar on Thursday, while Jakarta stocks have dropped over 30% year to date.
The bill also covers Danantara bond issuance, a demutualisation plan for the Indonesia Stock Exchange, a minerals bourse and a proposed international financial centre, underscoring a broader financial-sector overhaul.