Beware government Induced Collapse of Oil Prices on the amount

Finance Minister Bambang PS Brodjonegoro states weakening global oil prices should be addressed in conjunction with the slide in the exchange rate.

According to Bambang, the decline in world oil prices has led to the Russian central bank to respond by raising its benchmark interest rate from 10.5 percent to 17 percent. "This is the sixth time Russia should raise its policy rate, because there is depreciation of the ruble, inflation and commodity prices, especially oil pressure that eroded earnings up 50 percent," he said, in Jakarta, Tuesday (12/16/2014).

Bambang said, one of the things that caused the rupiah weakened enough in Russian policy is raising its policy rate it. "So imagine if BI is usually announced in the BI rate was typically 25 bps, 650 bps hike this is," he said.

Russian interest rates are rising so sharply implications for the outlook for emerging market investors. "Indonesia and the other was a group," he said.

That is, he added, when Russia raised interest rates of 650 bps, there may be thought to divert stock portfolio to Russia. "Well this pattern of thinking which led to changes in the market, especially the demand for dollars, the demand for government securities, government bonds and so on," said Bambang

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