TheJakartaPost
Please Update your browser
Your browser is out of date, and may not be compatible with our website. A list of the most popular web browsers can be found below.
Just click on the icons to get to the download page.
BI maintains rates amid stable inflation outlook
Bank Indonesia (BI) has kept its benchmark interest rate unchanged as it deems the current 6-percent rate sufficient to keep consumer prices under control.
Change Size
The Bank Indonesia (BI) board of governors pose for a photo on Nov. 11 before the press at the central bank's headquarters in Jakarta. (The Jakarta Post/Deni Ghifari)
B
ank Indonesia (BI) has kept its benchmark interest rate unchanged as it projects a stable inflation outlook for this year and 2024 despite global economic uncertainty.
Following the two-day monthly monetary policy meeting, BI Governor Perry Warjiyo briefed the press that the BI 7-Day Repo Rate (BI7DDR) was to be kept at 6 percent for the time being.
“BI monetary policy, especially interest rates, are set based on inflation estimates for the next two years and [whether those are] in line with our target. It has always been done that way,” said Perry on Thursday.
Perry explained that the impact of rates on inflation would only be felt after four to six quarters, during which the country would be exposed to the risk of imported inflation, which should explain why BI decided to hike its rates last month.
Imported inflation, explained Perry, would mainly be driven by global energy and food prices susceptible to ongoing uncertainty stemming from geopolitics and climate change, as well as rupiah depreciation.
The central bank had kept the benchmark rate at 5.75 percent since January, before proceeding to hike it by another 25 basis points last month.
Read also: BI unexpectedly hikes rate amid global uncertainty
