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Jakarta Post

BI rate must also promote growth: deputy finance minister

  • The Jakarta Post

    The Jakarta Post

Jakarta   /   Thu, October 10, 2013   /  05:09 pm

Deputy Finance Minister Bambang Brodjonegoro says that Bank Indonesia (BI) must consider the importance of pushing the economy to grow further when it makes a policy on its benchmark interest rate (BI rate).

'€œIf inflation is manageable and the foreign exchange rate is stable, why do we have to continuously raise the BI rate? This will only put more pressure on growth,'€ Bambang said as quoted by Antara.

Bambang said that monetary policies had to be balanced with fiscal policies so that current account deficit could be reduced without having to sacrifice growth.

Previously, BI decided to maintain the BI rate at 7.25 percent.

The central bank stated that it would continuously monitor the development of the global and national economy and would optimize its monetary and macro-prudential policy mix to ensure inflation would

remain manageable, the rupiah exchange rate's fundamental condition kept stable and the current account deficit could be reduced to a sustainable level.

 

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