Jakarta, 13th July 2022 – Economic management in Indonesia is confronted by complex global economic issues and dynamics characterised by uncertainty. Facing such issues, the central bank cannot rely merely on a single policy instrument alone, instead requiring a central bank policy mix that extends beyond monetary and macroprudential policies to include optimising payment system policy. The concept of a central bank policy mix must be well understood, accompanied by continuous enhancements to navigate changes in the strategic environment and overcome future challenges. That was the key takeaway of the seminar entitled ’Central Bank Policy Mix for Stability and Economic Recovery’ as part of the third day of side events for the G20 Finance Track: Finance and Central Bank Deputies (FCBD) Meeting and 3rd Finance Ministers and Central Bank Governors (FMCBG) Meeting in Nusa Dua, Bali (13/7).
Bank Indonesia Deputy Governor, Juda Agung, emphasised the importance of policy innovation and synergy as well as close collaboration to strengthen an effective policy mix framework. A single policy is insufficient to mitigate the various risks that have emerged recently and maintain macrofinancial stability.
Various ideas and concepts concerning the Central Bank Policy Mix flagship program were detailed in four broad categories, namely: (i) exploring the concept, implementation and future challenges, (ii) monetary policy concepts, primarily in terms of maintaining external stability, (iii) financial system stability, and (iv) navigating future challenges, with prominent speakers relevant to their respective areas of expertise. In addition to Bank Indonesia, speakers also attended from the International Monetary Fund (IMF), Bank for International Settlements (BIS) and peer central banks to share their country experiences.