Close coordination between the Government’s fiscal policy and Bank Indonesia’s policies are increasingly needed to ensure that the inflation can return to the target expeditiously, the Rupiah exchange rate is stable, the fiscal deficit is manageable, and monetary stability is maintained.
Fiscal policy must continue to be directed as a shock absorber against the impact of soaring global energy and food prices on domestic inflation by providing subsidies and social assistance programs, while simultaneously lowering the deficit to below 3% of GDP, as stipulated in the 2023 State Budget (APBN).