Indonesia’s central bank insists it is independent. Investors want proof
Huge bond purchases, the president’s nephew on board and a shifting legal role leave investors asking who really controls Bank Indonesia
The appointment of Destry Damayanti – initially as acting governor of Bank Indonesia (BI) in late July before her formal appointment last month – was meant to reassure markets. But analysts say that confidence will only return if economic policymaking becomes more credible and decisions affecting the country’s financial health become more transparent.
In an interview with Reuters on Monday, Destry insisted the central bank had “full autonomy” to set interest rates while maintaining “synergy” with the government.
“When we’re about to make a policy decision – whether to raise or lower interest rates or to use other incentives – we have full authority to make that decision,” she said.
