October’s Trade Deficit to Rocket to USD1.80 Billion
October’s trade balance was the deficit at USD1.80 billion after September’s surplus of USD230 million. On a cumulative basis, from January to October 2018, the deficit was at USD5.51 billion. October’s deficit was beset by worsening non-oil and gas trade balance and the higher deficit of oil and gas trade. October’s trade showed the increment in oil and gas as well as non-oil and gas exports. The total exports in October grew by 5.87% m-m. Meanwhile, October’s imports soared by 20.60% m-m to USD17.6 billion, attributable to the hike of 24.66% m-m in refined oil imports.
BI’s Stance of Raising Its Benchmark Rate
BI’s Board of Governors Meeting held on Wednesday and Thursday, 11/14 and 11/15, decided to hike BI 7-day reverse repo rate (benchmark rate) by 25 bps to 6.00%. In September, BI hiked its benchmark rate by 25 bps. Since May, it hiked its benchmark rate for 6 times with the total hike of 150 bps. BI’s pre-emptive stance of raising its benchmark rate as a method for facing the hike in the Fed’s Fund Rate (FFR) of December likely suppressing the rupiah.
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