Indonesia's Foreign Exchange Reserves Increased by US$10 Billion in 2016

Indonesia's foreign exchange reserves increased by US$4.9 billion in December 2016 to US$116.36 billion, up from the previous month. As a result, foreign exchange reserves increased by US$10.46 billion throughout 2016. The amount of foreign exchange reserves at the end of 2016 was the highest since May 2012. Furthermore, these reserves were sufficient to finance 8.4 months of imports and to pay off the government's external debt.

The high demand for rupiah exchange rate stabilization in November 2016 caused foreign exchange reserves to decline by US$3.75 billion to US$111.47 billion. Donald Trump's election as President of the United States triggered panic in global financial markets, including Indonesia. The rupiah even depreciated to over Rp 13,800 per US dollar. Bank Indonesia was forced to release its foreign exchange reserves into the market to meet the increasing demand for US dollars in order to prevent the rupiah from weakening excessively.