JAKARTA- Indonesia’s central bank expects the rupiah to strengthen from current levels and trade in a range of 15,300 to 15,700 per dollar in 2025, its governor said on Tuesday.
Governor Perry Warjiyo delivered the statement in a meeting with parliament to discuss economic assumptions for 2025, which will be used by the government to formulate next year’s budget.
The rupiah has been trading around 16,200 per dollar in recent days, close to four-year lows hit in April, as emerging market currencies come under pressure from uncertainty about US monetary policy and geopolitical worries.
The central bank also kept its forecast for 2025 economic growth at 4.8 percent to 5.6 percent , versus 4.7 percent to 5.5 percent this year. Last year, the economy grew 5.05 percent .
Bank Indonesia kept the headline inflation target at 1.5 percent to 3.5 percent , a similar range for 2024.
Indonesia’s economic growth in the first quarter beat expectations, buoyed by high public spending for the country’s elections, but maintaining the strong pace will be challenging due to global developments and tight local monetary conditions.
Southeast Asia’s largest economy grew by 5.11 percent on a yearly basis in the January-March period, the highest growth rate in three quarters. Growth exceeded the 5 percent rate expected by economists polled by Reuters and the 5.04 percent achieved in the fourth quarter.
In the first three months of 2024, campaign expenditure for the Feb. 14 election and higher household spending during the Muslim holy month of Ramadan, which started in March, bolstered economic activity.
