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Indonesia Balance of Payments in Quarter IV 2018 Experienced a Surplus

Jakarta, 11/02/2019 Ministry of Finance - Bank Indonesia (BI) released Indonesia's Balance of Payments (NPI) figures which in the fourth quarter of 2018 had a surplus. This surplus sustains the resilience of the external sector.

BI stated that in the previous quarter, the balance of payments had a deficit, but in the fourth quarter of 2018 it had a surplus of USD5.4 billion, supported by an increase in the capital and financial account surplus.

Quoted from the BI website, the position of foreign exchange reserves at the end of December 2018 increased to USD 120.7 billion, equivalent to 6.5 months of imports and government foreign debt, and was above the international adequacy standard of around 3 months of imports.

The capital and financial account surplus in the fourth quarter of 2018 increased significantly as a reflection of high investor confidence for  domestic economy outlook. The capital and financial account surplus was recorded at USD15.7 billion, a significant increase compared to the surplus in the previous quarter of USD3.9 billion.

This increase was mainly supported by the improvement in portfolio investment performance, in line with the increasing inflow of foreign funds in domestic financial assets. The increase in surplus was also supported by the issuance of global bonds by the government and corporations. In addition, optimism of Indonesia's economic prospects has encouraged domestic businesses to withdraw deposits at foreign banks to meet their business needs so that other investments are recorded as a surplus. (nr/ds)