Indonesia plans to cut three zeroes from rupiah

According to media reports, Indonesia’s central bank is planning to redenominate the rupiah by cutting three zeroes from the currency in order to simplify payments.

The bank emphasized the importance of making this change when the economy is stable and said that the introduction of new currency will not have a negative impact on purchasing power and on prices in the country given the stability of the economic situation of the country.

A similar plan had come into question four years ago but it was abandoned after the US Federal Reserve withdrew stimulus and caused a crisis in emerging market assets.

Economists argued that the banking sector and financial system need a transition period to implement the denomination plan to avoid any possible damage to the economy.