Foreign Exchange Reserves Rise to US$141.4 Billion in February 2022, Driven by Tax Revenue and Debt

Indonesia's foreign exchange reserves increased at the end of February 2022, reversing the previous month's decline. Bank Indonesia (BI) reported that the reserves reached US$141.4 billion, up from US$141.3 billion at the end of January 2022.

The increase in February 2022 was influenced by the government's foreign borrowing and receipts from taxes and services.

BI noted that the foreign exchange reserves were equivalent to 7.5 months of import cover, or 7.3 months of import cover and government foreign debt payments, exceeding the international adequacy standard of around 3 months of imports.

These reserves are considered sufficient to support external sector resilience and maintain macroeconomic and financial system stability.

Looking ahead, the central bank views foreign exchange reserves as remaining adequate, supported by sustained economic stability and prospects, along with various policy responses aimed at boosting economic recovery.

For clarity, foreign exchange reserves are reserves in foreign currencies held by the central bank to meet financial obligations arising from international transactions (reserve currency).

These reserves are used to support obligations and influence monetary policy. The majority of foreign exchange reserves are held in US dollars.