(News Today) - Indonesia’s president will soon nominate a new central bank governor, an official said on Saturday, filling a post which has been vacant for a year and which is expected to go to the acting governor, Darmin Nasution. Nasution, 61, is seen by the market as something of a dove because of his view that inflation will remain within the central bank’s target range of 4-6 percent this year.
He says that should allow Bank Indonesia to keep its key interest rate at a record low of 6.5 percent for the rest of 2010, stoking growth in Southeast Asia’s biggest economy. Newly appointed Finance Minister Agus Martowardojo, a career banker who succeeded Indrawati this month, has also indicated that interest rates could stay on hold throughout 2011 because of tame inflation.
By contrast, the market expects Bank Indonesia to start raising interest rates by the end of the third quarter this year as commodity prices rise and inflationary pressures build. State Secretary Sudi Silalahi told reporters on Saturday that the candidate for the position of governor would be
submitted to parliament for approval “as soon as possible, possibly as soon as today or, if not, next week.”
While the president can present parliament with a choice of candidates, Silalahi said only one name would be put forward this time. He declined to say who would be nominated but government ministers have already hinted that Nasution is the top choice.
Nasution worked closely at the finance ministry with former top reformer Sri Mulyani Indrawati and as head of the tax office implemented sweeping reforms to reduce corruption and increase tax collection in a country where tax evasion is widespread. He was sworn in as senior deputy governor of Bank Indonesia in July 2009, but has effectively served as acting governor after the governor, Boediono, quit to run as President Susilo Bambang Yudhoyono’s running mate in last year’s presidential elections.
Source : kompas.com
Monday, May 31, 2010
Indonesia New Central Bank Gov
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