Indonesia Market Summaries 16 May 2013

Bakrie Toll Road transaction is nearing completion

ELTY and the MNC Group’s transaction on the Bakrie Toll Road (BTR) sell is nearing completion as the deal was signed a couple of days ago. ELTY admitted that the transfer of syndicated loans and collateral was part of the issue that delayed the transaction; however, the issue has been cleared and the loans and collateral has been transferred to the MNC Group. (Kontan)

The government cut budget

The cut is intended for all government institutions by an average of 9.1% of their 2013 budget. The action is estimated to save Rp24.6tn and will be used to to finance budget deficit that is expected to reach 2.5% of GDP compared with initial projection of 1.65% of GDP (Kontan)

Bank Indonesia to respond subsidized fuel price hike with interest rate measure

Bank Indonesia governor Darmin Nasution expect inflation to bump up to 7.5-7.8% should subsidized fuel prices, premium and diesel, are increased to Rp6,000/liter and, alternatively, to 7.5% if each rise to Rp6,500/liter and Rp5,500/liter. Such condition warrants monetary policy review which may result in change of interest rate, though it is not yet clear which one will be utilized, the FasBI rate or BI rate (Kontan)

for Indonesia Market Summaries 16 May 2013