RI'S FOREX RESERVES DROP TO US$56.9 BILLION

Jakarta, July 24 (ANTARA) - The country's foreign exchange reserves at present stand at US$56.9 billion, down by US$700 million from their June 30 position, a central bank deputy governor said.

"The foreign exchange reserves now stand at US$56.9 billion," Bank Indonesia (BI) Deputy Govenor Budi Mulya said here on Friday.

He said that although the reserves slightly declined, their position remains safe. The BI deputy governor said that foreign exchange reserves' position could change any time in line with the need and developments of the economy.

Mulya said foreign exchange reserves were among others also used to intervene into the market to safeguard the value of the rupiah exchange rate against the US dollar. They are also used to meet the need for foreign currencies in the payment of foreign loans.

He said that it was a main task of BI to help maintain the stability of the rupiah currency. Therefore, BI has to watch and prevent the deep fluctuations of the rupiah.

"The important thing is to protect the rupiah from exaggerated volatilities," he said.

He said that the rupiah, which at present was gaining strength, happened to disturbed when JW Marriott and Ritz Carlton hotels in Jakarta were attacked with a bomb blast on Friday, July 17, 2009 last week.

BI Deputy Governor Hartadi A Sarwono said earlier that when the bombs went through at JA Marriott and Ritz Carlton, the Indonesian central bank was forced to make an intervention to offset market panic. At that time, according to Hartadi, the rupiah tumbled.

He said that the rupiah at the opening was recorded at Rp10,050 - Rp10,100 level per US dollar but it directly tumbled to Rp10,250.

Thus, the BI intervened so that the rupiah strengthened again to Rp10,080 per US dollar.

At present, the position of the foreign exchange reserves has declined by 1.1 billion dollars compared with that in the May 31, 2009 position which was US$57.9 billion.