Thu, 10/09/2008 - 18:35 — fx According to the announcement of the President Director of the Center for Bank Crises Ahmad Deni Daruri made on Tuesday the government of the country is still work with a free-flow foreign exchange system despite the fact it has already adopted a controlled foreign exchange regime.

Deni has also said that the current financial crisis started with the fall of the US financial institutions is nothing but the result of the President George W Bush plan to win his political competitors by economic means.
He has also said that the great number of Indonesian economic policy-makers are still oriented to free foreign exchange system that corresponds to US and this may easily get the country into the financial crisis like the one the world experienced in 1998.

Due to Deni now there will be more profit taking transactions at the stock market and the speculative buyers are not concerned about the economic fundamentals factor.

But the attempt of the Central bank to increase interest rate was only ironic measure.

It is planned to set up a meeting of the central bank of the country and bankers with an aim to stop credit expansion. And despite the positive reaction of the bankers for this offer it is quite difficult to stop credit expansion because of growing demand from non-trading sectors
effect of forex speculation on economy