The Malaysian Reserve

Rupiah rout puts caviar, choco on import hit-list

Shipping containers sit stacked at Semarang Port in this photograph taken with a tilt-shift lens in Semarang, Central Java, Indonesia, on Thursday, March 12, 2015. Central Java's exports of textiles, footwear, furniture and other goods have risen 46 percent over the last four years, according to the local investment board.

By BLOOMBERG

JAKARTA • Caviar, chocolate and stretch limousines could get a whole lot more expensive in Indonesia as the government takes steps to curb imports and halt a sliding currency.

Authorities have reviewed 900 products — from luxury items to basic goods like coffee, tea, pasta and ice cream — some of which will soon carry higher import taxes. A final list will be published as early as today.

Finance Minister Sri Mulyani Indrawati said yesterday the restrictions were needed after imported consumer goods surged more than 50% in July and August. “The government’s current efforts to cut imports, especially for consumption goods, might affect household consumption growth next year,” she said.

The government and central bank are stepping up action to protect the rupiah, which is heading toward 15,000 to the dollar for the first time since the Asian financial crisis two decades ago. Bank Indonesia (BI) has adopted a number of measures to improve liquidity and authorities said they will clamp down on speculation in the foreign-exchange market to curb volatility.

BI’s four interest-rate hikes since May and direct market intervention have failed to curb the currency’s more than 9% slide against the dollar this year, among the worst performers in Asia.

The rupiah lost as much as 0.8% to 14,933 yesterday, the lowest since July 1998. The Jakarta Composite Index fell as much as 1.2%, extending its retreat into a fourth day, the longest streak since June 22.