Bank Indonesia expects forex reserves to increase to $125b

first_imgThe rupiah exchange rate strengthened significantly against the US dollar on Thursday, allowing the central bank to reduce market intervention as it expected foreign exchange (forex) reserves to increase over this week.The rupiah was trading at Rp 15,880 to the dollar Thursday, up 2.28 percent from the previous close, according to Bloomberg data.Bank Indonesia (BI) governor Perry Warjiyo said the rupiah exchange rate was still undervalued even after the strong appreciation, adding that the central bank predicted the rupiah would strengthen further to 15,000 against the US dollar by the end of 2020. Foreign investors sold Rp 148.76 trillion (US$9.35 billion) in Indonesian assets, including Rp 135.08 trillion in government bonds and Rp 9.71 trillion in stocks, BI data shows. The central bank has purchased Rp 172.5 trillion worth of government bonds, including Rp 166.2 trillion from foreign investors in the secondary market, to stabilize the currency.“We see now that the strengthening rupiah was due to market dynamics,” Perry said. “This reduces BI’s need to intervene as our intervention has been declining recently.”Read also: BI expects rebound in foreign capital flows later this yearOn that basis, the central bank expects the country’s forex reserves to reach $125 billion this week as uncertainties surrounding financial markets start to subside.The reserves dropped $9.4 billion in March to $121 billion as BI stepped up market intervention to stabilize the rupiah exchange rate, which was volatile throughout the month.The government’s plan to raise funds from dollar-denominated bonds was also expected to help bulk up the country’s reserves, Perry added.The newly enacted Presidential Regulation (Perpres) No. 54/2020 on the 2020 state budget stipulates a steep increase in debt issuance to Rp 1 quadrillion this year from the initially targeted Rp 351.9 billion as the government seeks to fund the fight against the pandemic.The government plans to offer sovereign debt papers worth Rp 549.6 trillion, an increase from the initial Rp 389.3 trillion, while also planning to raise Rp 450 trillion in “pandemic bonds”.The Finance Ministry has raised $4.3 billion in dollar-denominated bonds this week, which could boost the country’s forex reserves by between $4 billion and $125 billion in the next week, Perry said.Read also: Bank Indonesia strikes $60b repo facility deal with US Fed as forex reserves drop“The conversion of dollar-denominated bonds into rupiah-denominated funds to be used by the fiscal authority to finance stimulus would increase the central bank’s foreign exchange reserves,” economists from the University of Indonesia Institute for Economic and Social Research (LPEM UI) wrote in a research note.According to the institution’s calculations, the issuance of Rp 450 trillion in “pandemic bonds” would increase the central bank’s foreign reserves by $15 billion if the debt papers were denominated in dollars.“Meanwhile, if all the pandemic bonds are denominated in rupiah, then the increase of foreign reserves will only reach $9 billion,” the researchers said.Topics : “If we measure the fundamentals of the rupiah exchange rate including against inflation, the current account deficit and interest rate differentials onshore and abroad, the rupiah is still undervalued and has the tendency to strengthen,” Perry said at a livestreamed media briefing on Thursday.Read also: ‘This is not a normal time’: BI to break barriers in COVID-19 battleDespite the jump, the rupiah remains one of the worst-performing Asian currencies as it has lost more than 14 percent of its value against the greenback so far this year after foreign investors dumped Indonesian assets following the novel coronavirus pandemic.The central bank has stepped up intervention, especially in March, in the spot foreign exchange and domestic non-deliverable forward markets. It has bought bonds dumped by foreign investors to anchor the value of the rupiah.last_img read more

Mercer starts master trust for UK DB schemes

first_imgInvestment consultant Mercer has launched its UK Mercer DB Master Trust, which offers defined benefit (DB) pension plan sponsors the potential for “enhanced governance and economies of scale to deliver better outcomes for members”, it said.Under the trust, Mercer will be responsible for providing all services including investment with fiduciary management, journey planning, actuarial services, covenant assessment, scheme management and administration, with trusteeship provided by independent professional trustees.The employer would maintain ultimate responsibility for the funding of the scheme, an announcement stated.This new solution adds to Mercer’s existing advisory and fiduciary offerings and ensures clients can access a full spectrum of approaches to select the best fit for their individual governance needs, it said. Benoit Hudon, leader of Mercer’s wealth business in the UK, said: “Managing employee pension schemes has become increasingly complex and many organisations suffer from time or cost constraints.”He said these challenges are “particularly acute” for smaller or mid-sized legacy DB schemes where often dedicated in-house expertise lacks, while access to best-in-class capabilities can be expensive.He added that the trust will “potentially reduce fees and improve outcomes”, while also giving members access to the largest administration of private sector pensions in the UK.The Mercer DB Master Trust has evolved from the Federated Pension Plan (FPP), an existing and long-established master trust initially set up by Jardine Lloyd Thompson that currently has around £260m (€280m) of assets and 73 participating employers.Additionally, Independent Trustee Services (ITS) and PTL have been appointed as additional professional trustees to work alongside PAN Trustees, which has been FPP’s trustee for more than 15 years.To read the digital edition of IPE’s latest magazine click here.last_img read more

Cricket News Allen, Pooran, Thomas handed West Indies contracts for first time

first_imgNew Delhi : World Cup returnees Fabian Allen, Nicholas Pooran and Oshane Thomas have been handed West Indies central contracts for the first time while seven players have been given all-format contracts.The number of all-format contracts for the men has now increased from four to seven with Darren Bravo, Shimron Hetmyer and Keemo Paul joining those in the Test and ODI formats — captain Jason Holder, Shai Hope, Alzarri Joseph and Kemar Roach — on the list.In total, 19 men have been retained for the upcoming contract year which runs from July 1 this year to June 30 next year including first-timers Allen, Pooran and Thomas who were part of the West Indies team which finished ninth out of 10 teams in the World Cup.Meanwhile, 15 women an increase of three have also earned central contracts  including veteran all-rounder Stacy-Ann King, fellow left-hander Kycia Knight and newcomers Shabika Gajnabi, Shawnisha Hector, Chinelle Henry, Natasha McLean and Karishma Ramharack.Cricket West Indies (CWI) policy allows up to 22 contracts to be offered each contract year to men’s players, so the selection panel may decide to offer additional central contracts throughout the year.CWI director of cricket Jimmy Adams said verbal offers had been made to all players, and contracts will be issued in the next few weeks, as soon as the board has concluded a new four-year Memorandum of Understanding with the West Indies Players Association.This is the third year that CWI will award central contracts to West Indies men under three different categories.WEST INDIES MEN CENTRALLY-CONTRACTED PLAYERS 2019-20:All-Format Contracts:Darren Bravo, Shimron Hetmyer, Jason Holder, Shai Hope, Alzarri Joseph, Keemo Paul, Kemar RoachRed-Ball Contracts: Kraigg Brathwaite, John Campbell, Roston Chase, Shane Dowrich, Shannon Gabriel, Jomel WarricanWhite-Ball Contracts: Fabian Allen, Carlos Brathwaite, Sheldon Cottrell, Nicholas Pooran, Rovman Powell, Oshane Thomas. For all the Latest Sports News News, Cricket News News, Download News Nation Android and iOS Mobile Apps.last_img read more