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Indonesia to unveil policy package to help rupiah

Thursday, August 27, 2015 - 12:32

[JAKARTA] Indonesia will announce on Thursday a policy package to help prop up the rupiah that includes tax holidays for investors, the country's chief economics minister said.

"This relates to the real sector. This relates to finance and (also) relates to deregulation, new policies (and) tax holidays," Coordinating Minister for Economics Darmin Nasution told reporters after meeting President Joko Widodo.

He noted that most of the new policies, primarily aimed at strengthening the rupiah, were expected to come into effect next week. "First it will make economic activity smoother. Secondly it will push for foreign currency to come in," Mr Nasution said.

Further details on the policy package will be clarified by the finance minister on Thursday, he added.

On Thursday, Bank Indonesia was spotted directly selling dollars, not through agent banks, to lift the rupiah, traders said.

The unusual move indicated strong determination of the authority to support the second-worst performing Asian currency so far this year by showing its presence in the market, traders said.

On Thursday, the rupiah hit a fresh 17-year low of 14,135 to the dollar.

REUTERS