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BI maintains key rate at 4.25 percent
Bank Indonesia (BI) has decided to maintain its benchmark rate on the back of macroeconomic and financial system stability as well as to support the domestic economic recovery.
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Bank Indonesia (BI) Governor Agus Martowardojo said domestic risks included ongoing corporate consolidation, weaker-than-expected banking intermediation and risks to inflation. (JP/Wendra Ajistyatama)
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ank Indonesia (BI) has decided to maintain its benchmark rate on the back of the macroeconomic and financial system stability as well as to support the domestic economic recovery.
BI's seven-day reverse repo rate was kept at 4.25 percent, while lending rates and the deposit facility rate were also maintained at 5 percent and 3.5 percent, respectively.
“We believe [the decision] was in line with the macroeconomic and financial system stability and supports Indonesia’s economic recovery,” said BI Governor Agus Martowardojo in Jakarta on Thursday.
However, Agus added that BI continued to monitor external risks, such as instability generated from the Federal Reserve's interest rate hike, which could be higher than anticipated, and the increase in oil price.
The domestic risks, meanwhile, include ongoing corporate consolidation, weaker-than-expected banking intermediation as well as risks to inflation, Agus added.
“Bank Indonesia will continue to optimize the monetary, macroprudential and payment system policy mix to maintain the balance between macroeconomic and financial system stability as well as strengthening the implementation of structural reform,” he said. (bbn)
