Thursday, May 2, 2013
BI: No Restriction on Forex Trading
Source: TEMPO.CO, Jakarta
LINDA TRIANITA | MARTHA THERTINA
TEMPO.CO, Jakarta - Deputy Director of Monetary Management at Bank Indonesia (BI), Bistok Simbolon, said that the central bank does not restrict foreign exchange (forex) traders from selling. "We do not want forex traders to be exploited by people seeking to gain short-term profits," he said Wednesday, May 1.
Earlier, BI issued a circular that points underlying transaction provisions to regulate forex purchase. It regulates that forex purchases valuing less that US$100 thousand per month only require a statement letter. Meanwhile, individual customers or business entities are required to submit underlying documents to purchases forex worth more than $100 thousand per month.
Bistok said that the issuance of the regulation is aimed at maintaining the stability of the rupiah. Thus, any purchase of foreign exchange will have a clear purpose of use and can be accounted for, as well as supporting the real sector.
"This is an effort to minimize forex purchase transactions that are speculative in nature," he said.
Previoously, Muhammad Idrus, Chair of the Indonesian Association of Foreign Exchange, said that forex traders refused to submit customers' data to banks. The rule is considered as BI's distrust towards forex transactions in money changers.
The rule was also seen as "overacting" because the value of forex transactions in money changers is generally small. "(The value) has not reached a point where it could affect the stability of the rupiah," he said.
BI's data shows that the value of forex transactions in money changers in 2011 only reached $17.5 billion. The number of licensed forex traders is estimated at around 900. Meanwhile, the Triennial Central Bank Survey shows that overall nominal forex transactions reached Rp30 trillion per day in 2010.