2022 State Budget: Fiscal Policy and Structural Reform
Principles of Domestic Non Deliverable Forward (DNDF) Transaction
Source: Bank Indonesia
Transaction Settlement
•
•
Use Fixing mechanism
Reference rate: JISDOR for USD/IDR and BI FX Transaction Mid Rate for non-USD/IDR
Settlement currency : IDR
Roll over and early termination are not allowed
Roll over and early termination for DNDF is prohibited
However, unwind can be done by opening the reverse DNDF transactions
Cover Hedging
Bank may conduct DNDF Transactions with Bank Overseas for cover hedging purpose.
Underlying Transactions: DNDF Transaction between Bank and Customer/Foreign
Purpose: Hedging
Customer/
Foreign Party
Overseas
Bank
Hedging
Cover
Hedging
Bank
Notes:
Customer A conduct DNDF transactions with Bank B, and so Bank B can conduct DNDF
transactions with overseas Bank for the purpose of cover hedge.
163View entire presentation