Jokowi’s central bank pick seen as ‘safe hand’

Bloomberg

President Joko Widodo’s choice of a career central banker to head Bank Indonesia signals monetary policy continuity as rising odds of faster US rate increases roil emerging-market currencies and bonds.
Widodo, also known as Jokowi, has nominated Deputy Governor Perry Warjiyo as his sole candidate, Sofjan Wanandi, adviser to Vice President Jusuf Kalla, said by text message on Monday. Warjiyo will need to be confirmed by the parliament after a “fit and proper test” to be held as early as next month.
He will replace incumbent Agus
Martowardojo, whose five-year term ends in May.
Challenges awaiting his successor include reining in food prices during the upcoming regional and presidential elections and easing currency-market volatility that’s made the rupiah the worst performer in Asia this month.
Bank Indonesia has cut interest rates eight times since the beginning of 2016 as it sought to accelerate economic growth that’s hovered around 5 percent since Jokowi took office in 2014.
“Perry has been instrumental in shaping Bank Indonesia’s standing today as a more credible and transparent institution, especially in the last few years,” said Euben Paracuelles, an economist at Nomura Holdings Inc. in Singapore.
“I would expect not just policy continuity in terms of the monetary stance but also a similar if not stronger commitment to pursuing financial reforms.”