QUARTERLY OUTLOOK ON MONETARY, BANKING, AND PAYMENT SYSTEM IN INDONESIA: QUARTER IV, 2016

Abstract

The Indonesian economy recorded development in Quarter 4, 2016. The growth increased with sound macroeconomic and financial system stability. The growth was supported by the growth ofhousehold consumption, better performance of investment, and the raise of export. On the other hand, the macroeconomic stability is well maintained as reflected on lower inflation, decreasing current account deficit, and stable Rupiah against foreign exchange. Domestic economy improves in accordance with the lower global financial risk and provides room for easing monetary policy on Quarter IV, 2016. The central bank lower the policy rate is well transmitted and is expected to strenghthen the growth momentum of economy ahead. Looking forward however, we still have to keep an eye on several external and domestic risks. For these reasons, Bank Indonesia keeps strengthening its monetary and macroprudential policy mix, and its coordination with the government in order to maintain the macroeconmoic stability, supporting the growth, and accelerate the structural reforms.