Bank Indonesia to Remain Independent but Share Deficit Burden Until 2021: President Widodo

Indonesian President Joko Widodo has pledged that the country's central bank, Bank Indonesia, and its monetary policy would remain "credible and independent", although its burden-sharing with the Government of Indonesia would continue until 2021, according to media reports.

The pledge follows on the heels of a recent proposal by Parliament regarding changes to the 1999 Central Bank Act, which was met with criticism by economic experts that it may weaken Bank Indonesia’s authority. The announcement also made a negative impression on both the Indonesian rupiah (IDR) and the country's stock market, as Bank Indonesia's benchmark interest rate has thus far been used to guard its currency amidst economic headwinds, news...