Normalization of monetary policy by the central bank of the United States (US) is considered to be able to affect various business sectors. As for the US central bank, the Federal Reserve (The Fed) signaled that this year it could start the process of reducing stimulus or tapering off.

Bank Mandiri Vice President for Industry and Regional Research Office of Chief Economist (OCE) Dendi Ramdani said there are several business sectors that have the potential to be affected by tapering off. This is due to the industry's dependence on imported materials.

The impact of tapering off, said Dendi, went through two channels that directly impacted the business sector, namely through imports due to potential pressure on the exchange rate and potential interest rate hikes.

"I think it is necessary to be vigilant, for example, if the manufacturing sector is the textile sector, then also the petrochemical sector. That's a lot of imports too, or the raw materials even though there are from domestic but according to the [US] dollar price. - properly manage the need for the dollar for imports," he explained at Bank Mandiri's Macroeconomic Outlook 2021 event "Indonesian Economy 2021-2022: Maintaining Growth Momentum"

In addition, sectors that have the potential to be affected by tapering off are sectors that have high leverage or use of debt or loans. Dendi gave an example that companies operating in the construction sector have the potential to be affected by the normalization of US monetary policy.

"So those with high leverage must anticipate the interest rate hike later. I think they should be able to anticipate what will happen in the future," he said.

On the economic side at large, Bank Mandiri Chief Economist Andry Asmoro said that if the Fed decided to taper at the end of 2021 or 2022, the impact would not be as big as what was felt during the 2013 taper tantrum.

According to Andry, this can be seen from the low inflation in 2021, the manageable current account deficit (CAD), the smaller portion of foreign ownership in the bond market, and the position of foreign exchange reserves which reached a record high.

Although a number of indicators show Indonesia's better resilience in the face of tapering, Andry views that Indonesia still needs to pursue a rapid economic recovery in 2022.

This is related to the benchmark interest rate policy of central banks, especially the Fed, which will gradually occur in line with the economic recovery. Fed Chair Jerome Powell has signaled that a US interest rate hike will not happen anytime soon.

Andry said that there are a number of scenarios for the economic recovery period and scenarios for dealing with changes in global central bank interest rates.

He said the period from 2020 to 2022 was a period for Indonesia to survive the Covid-19 pandemic crisis and a period of economic recovery. Meanwhile, 2023 to 2025 is a period of anticipating changes in global central bank policies.

"We imagine that if we use the baseline scenario where the Fed will only raise interest rates in 2023, we anticipate that we need to recover domestically by 2021 and 2022. [At that time], we must be ready, because in the future the challenges will be different again, " he explained.