(Adds central bank governor’s comments)
JAKARTA, March 24 (Reuters) - Indonesia’s government may need room for its budget deficit to exceed the 3% legal limit as the country battles the spread of the coronavirus and its economic impact, Deputy Finance Minister Suahasil Nazara said on Tuesday.
He told an investor call that the government is increasing health spending to 1.5% of gross domestic product (GDP) from 0.8% of GDP by reallocating other spending, but he said the government is gearing up for more spending as the virus spreads.
A parliamentary committee has suggested the government raise the cap to 5% of GDP.
Indonesia central bank governor Perry Warjiyo said Bank Indonesia continues to inject dollar liquidity into the market and to buy back bonds from the market to help support the rupiah.
“The dollar liquidity is there, no need to panic,” he said. The rupiah on Monday hit its lowest level since the 1998 Asian Financial crisis. (Reporting by Fransiska Nangoy, Tabita Diela; Editing by Muralikumar Anantharaman)