Revised law boosts parliamentary oversight and expands mandate of Indonesia’s central bank

Indonesia's central bank facing closer watch from parliament after revisions to a sweeping financial sector law were passed. The legislation allows lawmakers to evaluate the performance of Bank Indonesia, and other key institutions including the Financial Services Authority. The changes are adding to worries about potential political interference even though the finance minister has pledged to uphold the central bank’s independence. The revisions also putting greater emphasis on Bank Indonesia's role in supporting economic growth. They come as investors grapple with growing uncertainty over Indonesia's economic outlook. The Rupiah has weakened past a key 18-thousand level to a record low against the US dollar, while the main stock index has fallen to a near six-year low. Concerns have been fuelled by changes to commodity export policies, potential pressure from ratings agencies and rising oil prices due to the war on Iran. For more analysis, we were joined by Radhika Rao, Senior Economist at DBS Bank, Singapore.