International Monetary Fund. Asia and Pacific Dept
The 2023 Article IV Consultation highlights that Indonesia’s forward-looking and well-coordinated policies helped it close out the highly challenging global environment of 2022 with healthy growth, falling inflation, and a stable and profitable financial system. Growth is projected to moderate slightly in 2023 amid tighter domestic policy settings and the normalization of commodity prices, while inflationary pressures are expected to subside, with inflation falling within BI’s headline inflation target band in the second half of 2023. Risks are balanced, but a highly uncertain global economic environment continues to cloud the outlook. Continued high inflation and growth slowdown in major economies, lower commodity prices, and heightened volatility in global financial markets constitute key near-term risks. Monetary policy tightening has been important to address increased risks to inflation and can be maintained at its current neutral stance. BI should stand ready to further tighten monetary policy if inflation surprises on the upside.
International Monetary Fund. Western Hemisphere Dept.
This paper discusses Haiti’s Request for Disbursement under the Rapid Credit Facility (RCF). While Haiti’s population was already suffering severe malnutrition and food insecurity before the war in Ukraine, especially its suffering has been compounded by the surge in food commodity prices. IMF emergency support under the food shock window of the RCF will help fill the balance of payment gap and support those most affected by food price rises through feeding programs and cash and in-kind transfers to vulnerable households, waives school fees and other measures. The combination of appropriate macroeconomic and structural policies under the Staff-Monitored Program (SMP) provides additional safeguards for the IMF’s outstanding obligations. While providing adequate liquidity support to the financial sector, the central bank should reduce monetary financing of the deficit and limit foreign exchange interventions to smoothing volatility. The SMP is also catalytic to donor support. A successful implementation of Haiti’s SMP would be key in the process of restoring macroeconomic stability and sustainability, strengthening the social safety net, and tackling governance weaknesses and corruption.