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Indonesia's Weak Currency a Source of Strength, World Bank Says

Bloomberg business news
Indonesia’s central bank expects the selling pressure on the rupiah to ease next year. Kathleen Hays reports.(Source: Bloomberg)

Indonesia’s economy is much stronger than during the 1997 Asian financial crisis and the currency’s weakness is a source of strength, the World Bank said.

“With a flexible exchange rate now, moderate devaluation makes imports more expensive, exports cheaper, and the dollar value of profit transfers lower,” Rodrigo Chaves, the bank’s country director for Indonesia and Timor-Leste, said in a statement on Wednesday. “These elements reduce the current-account deficit automatically.”