JAKARTA, July 24 (Reuters) – The Indonesian government may begin to sell bonds directly to the central bank via private placement next week, under a 397.6 trillion rupiah ($27.48 billion) fiscal deficit financing scheme, a senior finance ministry official said on Friday.

Bank Indonesia has pledged to buy the bonds and then rebate all interest payments back to the government, under a “burden sharing” agreement with the government to fund the country’s COVID-19 response.

“We’re now setting up a special account and hopefully by next week we can begin the implementation,” Luky Alfirman, who heads the ministry’s financing and risk management department, told a virtual news briefing.

Alfirman said the bonds will carry a duration of between five to eight years. ($1 = 14,470.0000 rupiah) (Reporting by Tabita Diela and Gayatri Suroyo; Editing by Muralikumar Anantharaman)

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