2020 State Budget Deficit Widen to Rp 1,039 Trillion

The 2020 State Budget (APBN) has changed completely due to the addition of spending funds for handling the economy and health due to the Covid-19 pandemic. Initially, Covid-19’s handling funds were valued at Rp 405.1 trillion. In the latest draft, the value has risen to Rp 677.2 trillion. According to Sri Mulyani, the additional budget caused the 2020 State Budget deficit to widen to Rp 1,039 trillion or 6.34% of GDP. To cover the deficit, the government will rely on the issuance of Government Securities (SUN). (Kontan)

The Federal Reserve is expanding a $500 billion emergency lending program for state and local governments to include smaller borrowers, following concern that some needy communities might miss out. The municipal facility, which is backed by funds from the U.S. Treasury Department and can support up to $500 billion in credit, is one of nine Fed emergency lending programs aimed at mitigating the economic impact of the coronavirus pandemic. (Bloomberg)

Source: Danareksa Sekuritas Debt Research

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