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Indonesia central bank governor reiterates support for rupiah

Source
Reuters - February 20, 2009

Jakarta – Indonesia's central bank will support the rupiah currency and may "add more ammunition" to contain the volatility, the central bank governor said on Friday, reiterating earlier comments as the currency weakened.

"The dollar is strengthening against many currencies. The problem is that this is definitely a global movement. We will surely be cautious so that our rupiah will not be too volatile," Boediono said.

"We will use the instruments that we have to contain the volatility. We will use the ammunition that we have and if necessary, we will add the ammunition." He did not elaborate.

Several Asian currencies fell to multi-month lows against a broadly firmer dollar in trading driven by worries over the banking sector in Europe and broader fears about global growth.

The Indonesian currency is the second-worst performing currency in Asia after the South Korean won, which has fallen around 16 percent.

The rupiah moved in tight ranges around 12,000 per dollar, with the central bank suspected of selling dollars in the market to support the rupiah, which has lost around 9 percent against the dollar so far this year.

The country's foreign exchange reserves had fallen to $50.87 billion by the end of January, down from around $57 billion in September. (Reporting by Muklis Ali; Writing by Tyagita Silka; Editing by Sara Webb)

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