Wednesday, 13 December 2017 | 12:41 WIB

Bank Indonesia Opens Hedging Transaction Swap using Renminbi

Bank Indonesia Opens Hedging Transaction Swap using Renminbi (beritamoneter)

JAKARTA, NNC - Bank Indonesia (BI) has opened a hedging transaction swap option using Offshore Chinese Renminbi (CNH) currency starting on December 6, 2017. Previously, Bank Indonesia opened the hedging transaction swap using Japanese Yen (JPY) on July 12, 2017 and Euro (EUR) on October 25, 2017.

"The addition of foreign currency types used in hedging transaction swap to Bank Indonesia is conducted among others to encourage more diverse sources of financing for national economic activities." said Agusman, Head of Communication Department at BI on Tuesday (12/05/2017).

He explained that the window time for hedging transaction swap to Bank Indonesia in non-US dollar currency is opened once a week every Wednesday at 14:00 to 16:00.

A bank may propose a hedging transaction swap to Bank Indonesia for the CNH currency in the window time with a minimum nominal submission of CNH 10,000,000, with a multiple of CNH 1,000,000 and tenures available for 3 and 6 months.

Agusman also explained that the filing of the transaction can be done by the bank by submitting the basic needs or underlying transactions.

The regulation of underlying transactions has been set forth in Bank Indonesia Regulation No.18/8/2016 on Third Amendment to Bank Indonesia Regulation Number 15/17/PBI/2013 concerning hedging transaction swap to Bank Indonesia.

Agusman added that BI’s hedge transaction swap policy is expected to support diversified international investment and trade activities in various currencies.

"In addition, the transaction is expected to help manage liquidity and maintain the stability of the Rupiah exchange rate," he concluded.