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Bank Indonesia to Beef Up Tools in Battle to Shield Rupiah

  • Interest-rate swaps, overnight index swaps being considered
  • Central bank weighs offering short tenor forex swap hedging
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Indonesia is trying to protect the rupiah, while Malaysia is set to keep rates steady. Kathleen Hays reports,(Source: Bloomberg)
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Indonesia’s central bank is intensifying its fight to protect the nation’s currency and bonds with a slew of measures that includes more hedging tools.

Bank Indonesia plans to soon introduce overnight index swaps and interest-rate swaps to widen its pool of hedging tools for investors, exporters and banks. The central bank will also start offering a one-month tenor foreign-exchange swap hedging facility, said Nanang Hendarsah, executive director for monetary management.