Indonesia's Foreign Exchange Reserves Increase at the End of 2023

FOREIGN RESERVE - JAKARTA. The position of foreign exchange reserves at the end of 2023 increased. In December 2023, Indonesia's foreign exchange reserves were recorded at US$ 146.38 billion, an increase of 6.01% compared to the previous month. 

Looking at the components of foreign exchange reserves, an increase occurred in all components, with the sharpest increase in the foreign currency reserves component. 

Citing data from the Special Data Dissemination Standard (SDDS) on the official Bank Indonesia (BI) page, this component was recorded at US$ 131.98 billion, an increase of 6.58% compared to the previous month. 

Foreign currency reserves consist of foreign banknotes and deposits, as well as financial derivatives. This component can also be in the form of securities such as participations, shares, bonds, and other money market instruments.

Foreign currency reserves also include monetary authority claims to foreigners or non-residents. 

The second largest increase is the other reverses assets component. Recorded at US$ 638.62 million, an increase of 4.83% from the previous month. 

Other Reverses Assets is a component that includes claims that are not included in other claim categories. 

The next largest increase came from monetary gold. This component was recorded at US$ 5.23 billion, an increase of 1.33%. 

Monetary gold is a stock of gold owned by the central bank, in the form of gold bars that meet certain international requirements, such as London Good Delivery (LGD). 

In addition, what is included in monetary gold is pure gold, as well as gold currency both domestically and abroad. 

Monetary authorities who want to increase their gold ownership can mine new gold or buy gold from the market, but they must monetize the gold. 

Conversely, monetary authorities can also issue gold ownership for non-monetary purposes, but they must demonetize the gold. 

Then, an increase was also seen in the IMF Reserve Position (RPF) component and the Special Drawing Rights (SDRs) component. 

RPF was recorded at US$ 1.06 billion, an increase of 0.38% from November 2023. While SDRs were recorded at US$ 7.46 billion, an increase of 0.38%. 

RPF is a country's foreign exchange reserves that exist in the International Monetary Fund (IMF) account.

This RPF also shows the wealth position and the country's claims to the IMF as a result of transactions with the organization and shows its membership. 

IMF members can have a position in the Fund's General Resources Account which is recorded in the foreign exchange reserves category. 

Meanwhile, SDRs are a facility provided by the IMF to its members to increase international liquidity. This facility allows for the increase or decrease of foreign exchange reserves in member countries. 

As additional information, BI confirms the recording of the value of foreign exchange reserves in general statistics according to market prices, which is the market exchange rate that affects at the time of the transaction.