Indonesia draft law seeks to limit Central Bank autonomy

JAKARTA, March 15 (Bloomberg): Indonesia is pursuing another attempt at increasing government influence in the decision-making and operations of its central bank, as well as expanding its ability to fund public debt, according to a draft legislation to be discussed in parliament.

A proposed omnibus financial sector reform bill would require Bank Indonesia to take into account the government’s broad economic strategy when making monetary policy decisions, according to a copy of the bill reviewed by Bloomberg. The central bank’s mandate would also be extended to promoting job creation, supporting sustainable economic growth and keeping stability in the financial system.