Huge win on appointment of Indonesian central bank head

Reuters was ahead of Bloomberg by one hour on news that Indonesia’s Golkar Party was likely to back Darmin Nasution as the new central bank chief, assuring a parliamentary majority for the appointment. Stocks rose over 1 percent and the one-year bond yield tumbled 23 basis points — its biggest daily drop in two weeks – when markets opened the next morning. Investors expected the appointment of Nasution, seen as a policy dove, will also help Indonesia obtain investment grade rating next year. Lawmakers grilled the president’s choice for two days and the backing was particularly important in the wake of the recent departure of finance minister Sri Mulyani Indrawati in despair at the attacks on her by business-backed parliamentarians. A vote against Nasution would have been a second big blow for the reformists.