July 2017 4th Week

01 august 2017

Categories : IR Weekly Review

    • MACRO
      • The Federal Reserve (The Fed) decided to keep its benchmark interest rate on Wednesday (26/7). This decision was taken after a two-day Federal Open Market Committee (FOMC) policy meeting. However, the central bank also signaled it would soon reduce the stimulus. "The committee expects to begin implementing the" relatively immediate "balance sheet normalization program, given that the economy is broadly evolving as anticipated," the Fed's policy-making committee said in a statement. The Fed's balance sheet has swelled to around US $ 4.5 trillion following three rounds of quantitative easing programs to withstand the effects of the global financial crisis of 2008. Along with the US economy returning to a stable growth path, Fed policy makers are preparing to release crisis-era policies to avoid Inflationary pressures or pumping asset bubbles.

      • The International Monetary Fund (IMF) maintains a projection of world economic growth this year and next year. But, the IMF revised the projected economic growth of the eurozone, China, the United States (US) and Japan. In the global economic outlook published by the IMF on Monday (24/7), mentioned global gross domestic product (GDP) will grow 3.5% in 2017 and 3.6% in 2018. Projection is the same from before. "The risk of economic growth is still balanced and leaning towards the downside in the medium term," the IMF said. Instead, the IMF shaved its forecast for US economic growth in the next two years. The IMF saw the US economy look more fragile. The IMF lowered its forecast for US economic growth to 2.1% for the year and next year. The projection is down from the previous prediction of 2.3% for 2017 and 2.5% in 2018.     

      • Review : 

        From the description above, it can be indicated that the Fed will begin to reduce its balance sheet in the coming months. However, the reduction in the balance sheet should not disrupt the market.

    • MICRO
      • Bank Indonesia Governor Agus D.W. Martowardojo said it predicted that inflation in July 2017 could be lower by 0.18 percent (month to month) or year on year 3.84 percent (year on year). "So we welcome that inflation continues to be maintained and if we consider that the source of deflation is in line with air transport and inter-city transport," he said at the Parliament Complex in Senayan, Jakarta, Tuesday, July 25, 2017. As infected in June 2017 Reaching 0.69 percent (month to month) or 4.37 percent (year on year). Agus said Bank Indonesia continued to conduct surveys to monitor the inflation rate, which in the first week of July was 0.32 percent (month to month) and in the second week by 0.24 percent (month to month).

      • Financial Services Authority (OJK) assesses investment mutual fund products more attractive. This is reflected in the number of investors who began to grow significantly. The situation will also encourage existing trading transactions in the Indonesian capital market. "We see Single Investor Identification (SID) every investor has a kind of ID card in mutual fund, so that is 530,615.In comparison with 2015, there are 247,982.His increase of about 114 percent," said Director of Investment Management OJK Sujanto, found in BEI Building, SCBD Sudirman, Jakarta, Friday July 28, 2017. So far, he added, many investors prefer to invest in equity funds. Based on the total Assets Under Management (AUM) data, the figure reached Rp387 trillion on July 25, 2017. Compared to the last seven years, the figure rose 152 percent from Rp153 trillion.

      • Review :

        Bank Indonesia and the government are expected to jointly keep inflation on target. The coordination and routine control is not only done during Ramadan, but also throughout the year.

      • PT Bank Tabungan Negara Tbk (BBTN) once again posted positive performance in the first half of this year. In the first half of 2017, Bank BTN disbursed loans and financing worth Rp177.4 trillion, up 18.81% year-on-year from Rp149.31 trillion in the same period a year earlier. Meanwhile, BTN's credit growth reached twice the average credit increase in the national banking industry. Data from the Financial Services Authority (OJK), national banking credit rose 8.77% yoy as of May 2017. President Director of Bank BTN Maryono said that Indonesia's economy was beginning to show positive signs on the back of government policy and increased public and investor confidence both local and global economy in the country, especially the financial sector.

      • Bank Mandiri is optimistic to strengthen fee based income with the concept of lifestyle banking in 2019. The Company continues to strengthen the e-channel network infrastructure so that the future community can use in all areas of life. SEVP Bank Mandiri's Digital and Comprehensive Financing Bank Mandiri, Rahmat Triaji explains that there is a trend of migration of e banking usage by customers. This is in line with the company's vision to rely on omni channel in 2018 and become a lifestyle banking in 2019. Banking industry trends are competing to improve digital services to lower operating costs and also to get additional cheap funds to be more efficient in lending. "Our digital banking vision meets the lifestyle of the community or is used since waking up to go back to sleep, our strategy is to continue expanding our network at merchants and have a strong fintech in innovation We do not want the bank to be history because it does not adapt," said Rahmat in Jakarta on Tuesday (7/25/2017).

      • Review : 

        With increasing lending, BTN must be able to find and create new innovations. As it is known that BTN still leads the market share of KPR in Indonesia. The programs that have been run by BTN include the One Million House Program.

Disclaimer : This document is for informational purposes only and obtained from a variety of reliable sources, but is not a guarantee the accuracy or completeness and should not be relied on completely. The above conditions may be changed at any time. Forbidden to rewrite anything without written permission from The East Java Regional Development Bank