Investors flock to Jakarta dollar securities

Contingency plan: A shopkeeper counts bank notes in a textile outlet in Jakarta. Bank Indonesia is likely to keep the dollar notes as one of its go-to instruments to attract foreign inflows in the event of another rupiah sell-off. — AFP

JAKARTA: Bank Indonesia’s first auction of its US dollar securities, meant to attract foreign inflows that would support the rupiah, is oversubscribed.The central bank sold US$236.5mil in the Tuesday offer of foreign exchange-denominated securities (SVBI), exceeding its US$200mil target. It awarded US$168mil for the one-month paper at an average rate of 5.45% and US$68.5mil for the three-month note at an average rate of 5.6%.

Bank Indonesia launched its newest monetary instrument at a time of shifting market appetite, with the dollar on the retreat amid bets the US Federal Reserve (Fed) has reached its peak rate.