I therefore see the benefits of the following policy strategy : 1. From the monetary policy side: the implementation of inflation targeting framework (ITF), within the wider structure of macroeconomic policy, is a strategic step that must continually be taken by Bank Indonesia to maintain market confidence on macroeconomic stability and overall financial system stability.
A number of issues related to capital flows, exchange rates and the interest rate within a liberal capital account regime and a floating exchange rate environment should be placed in the context of global economic adjustments and the kind of macro-monetary policy response that would be appropriate to deal with them.