JAKARTA: When Destry Damayanti was appointed Indonesia’s acting central bank governor two weeks ago, one of her first meetings that day was at the finance minister’s office.
Before heading to meet President Prabowo Subianto at the presidential palace, Destry stopped by to meet Finance Minister Purbaya Yudhi Sadewa, giving a strong signal of her willingness to work closely with him to coordinate monetary and fiscal policy. A few days later, the two sat side-by-side at a press briefing, shaking hands and sharing smiles.
That friendly chemistry was a marked contrast from her predecessor, Perry Warjiyo, whose meetings with the finance minister tended to be in broader settings at the president’s palace or at regulatory committees. The only publicly reported one-on-one meeting between Warjiyo and Purbaya happened at the central bank’s offices in September 2025.
Prabowo has now nominated Destry - who was Warjiyo’s deputy since 2019 - as the sole candidate for governor of Bank Indonesia, seeking to strike a balance between a market-friendly technocrat and an official aligned with his economic agenda of faster growth.
Destry’s challenge will be to demonstrate to investors she can meet the president’s goals while maintaining the central bank’s autonomy.
Economists and analysts have so far been encouraged by her appointment, saying they expect policy continuity and a focus on keeping the rupiah stable. Her rapport with the finance minister also means stronger coordination with the government and a possibly more dovish stance.
"We expect BI’s communication with the government to improve going forward,” Helmi Arman, an economist at Citigroup Inc., wrote in a note. "Yet the broader environment for institutional credibility remains dynamic.”
Markets initially welcomed Destry’s announcement on Monday, with the rupiah extending gains against the dollar to the strongest level in a month and outperforming most Asian currencies. Her nomination still requires parliamentary approval.
Investors have been rattled by Prabowo’s populist policy measures over the past year, including his spending on free school meals and increased state control of commodities. The rupiah is down about 6% against the dollar this year, the worst performer in Asia.
Fitch Ratings Inc. and Moody’s Ratings have put Indonesia’s sovereign ratings on negative watch, citing policy uncertainty, though S&P Global Ratings kept its stable outlook.
Under Warjiyo, BI has been deploying a broad mix of instruments to manage competing objectives. It’s raised interest rates three times since May and intervened in the foreign exchange market to support the currency, while relying more heavily on non-rate tools to support credit and economic growth.
Investors will be watching whether the central bank remains willing to maintain or raise interest rates when necessary, and whether liquidity policy continues to be guided by monetary and financial-stability needs, said Irman Faiz, chief economist at PT Bank Danamon.
Destry’s job will be made harder as rising global interest rates and a strong dollar continue to put pressure on the rupiah, even as domestic inflation remains relatively contained. At the same time, Prabowo’s goal is to boost growth toward 8% by 2029.
BI should continue working closely with the government, Faiz said, but monetary decisions must ultimately be based on its assessment of inflation, the rupiah and financial stability.
"Coordination is necessary, but policy subordination is not,” he said.
Destry comes with strong credentials. She holds a bachelor’s degree in economics from the University of Indonesia and a master’s degree in regional science from Cornell University.
Prior to joining the central bank, she was chief economist at PT Bank Mandiri and a commissioner at the Indonesia Deposit Insurance Corp., an agency previously run by Purbaya.
She’s also well-known to the investor and analyst community, regularly engaging with them on central bank policy.
While policy continuity is important, the next phase for BI should go beyond simply preserving the stability achieved in recent years, according to Fakhrul Fulvian, chief economist at PT Trimegah Sekuritas Indonesia.
The central bank now needs to translate that stability into healthier liquidity conditions, a more normalised yield curve, stronger monetary transmission and renewed private-sector confidence, he said. - Bloomberg
