Indonesia central bank to buy up to US$30.5 billion of bonds directly from govt-report

JAKARTA : Indonesia's central bank and the finance ministry have signed an agreement to allow Bank Indonesia to directly buy sovereign bonds worth up to 439 trillion rupiah (US$30.46 billion) in 2021 and 2022, CNBC Indonesia reported on Monday, citing a government document.

The proceeds, up to 215 trillion rupiah for 2021 and 224 trillion rupiah in 2022, will be used to fund the government's vaccination campaign and other COVID-19 relief measures, it reported.

Bank Indonesia will relinquish interest payments for bonds worth 58 trillion rupiah in 2021 and 40 trillion rupiah in 2022, but the rest of the notes will carry a floating interest rate equal to the central bank's three-month reverse repo rate, according to the news website.

The finance ministry and central bank did not immediately respond to a request by Reuters for comment.

(US$1 = 14,410.0000 rupiah)

(Reporting by Gayatri Suroyo; Editing by Ed Davies)