Sri Mulyani Highlights The Implications Of Trump's Victory For Indonesia

Thursday, 14 Nov 2024

By ferry@insightinnews.com The victory of Donald Trump in the United States presidential election is said to have significant implications for the global economy. This assertion was made by Finance Minister Sri Mulyani Indrawati. She indicated that the first impact would be felt in terms of policy changes. As the largest economy in the world, the United States is expected to undergo various policy shifts due to differing perspectives from the previous administration led by Joe Biden. "This will inevitably lead to numerous policy changes, as President Trump is supported by the Republican Party, while President Biden is from the Democratic Party," stated Sri Mulyani during a press conference on the state budget on November 8, 2024. She expressed concern that the trade war between the United States and China may escalate. Furthermore, geopolitical tensions in several countries remain unresolved. "Certain policy changes have already triggered immediate reactions in the market, such as expectations for corporate tax reductions, increased spending, and anticipated hikes in import tariffs on countries trading with the United States, particularly concerning China," explained Sri Mulyani. Sri Mulyani highlighted a notable divergence in views between Donald Trump and his predecessors regarding climate change. She noted that Trump appears to be more committed to reducing CO2 emissions. This shift in policy and perspective is anticipated to influence global oil prices. "Particularly in the energy sector, this will have a significant impact on both global oil prices and future trends related to climate change and energy issues," she stated. In addition to policy changes, Sri Mulyani remarked that Trump's victory has generated considerable sentiment in the market. One immediate effect is the impact on global currency exchange rates, including the Indonesian rupiah. She indicated that the exchange rate of the US dollar had strengthened to Rp 15,200 by October 2024, although it experienced a decline due to global sentiment stemming from the Federal Reserve's interest rate cuts. "Following the election of President Donald Trump, the dollar index has strengthened, which has put pressure on our rupiah," she explained. With the prevailing sentiments leading to this pressure, Sri Mulyani noted that the rupiah has depreciated by 2.68%. However, when compared to the currencies of G7 and G20 nations, the rupiah's performance remains relatively stable. "Indonesia's exchange rate situation is still quite favorable, with a depreciation of 2.68%, in contrast to Canada at 4.46%, the Philippines at 5.69%, and South Korea at 6.79%," she concluded.

We would appreciate your comments

Business_Economy