JAKARTA, Oct 29 (Reuters) – Indonesia central bank governor Destry Damayanti said on Thursday that global index provider MSCI’s recent warning of a possible downgrade of the country’s stock market to “standalone” status was “a short-term shock”.
• Destry said improving transparency could not happen overnight but she believed several reforms introduced by Indonesia’s financial services authority (OJK) would be enough to address MSCI’s concerns
• “We see the MSCI situation as a short-term shock and we hope that once the issues causing concern have been addressed, it will be able to recover again,” she said at an economic event
• MSCI currently classifies Indonesia as an “emerging” market
• The recent warning was more severe than MSCI’s January warning that it could downgrade Indonesia to “frontier” status
• Bank Indonesia would remain focused on stabilising the rupiah going forward, Destry said, adding that the current benchmark rate is enough to anchor inflation expectations within the target range of 1.5% to 3.5%
• When asked about a potential rate hike by reporters, she said “any decision would be data-dependent”
(Reporting by Stefanno Sulaiman, Ananda Teresia; Editing by Martin Petty and David Stanway)
