JAKARTA: Bank Indonesia (BI) again maintained its benchmark interest rate or BI Rate on Wednesday (20 March) as predicted by 31 economists surveyed by Reuters.
Bank Indonesia did not change its benchmark interest rate at 6 percent, the same figure since October 2023.
The other two interest rates also remained unchanged.
This decision is in line with efforts to maintain rupiah stability and control inflation, said BI Governor Perry Warjiyo.
The rupiah exchange rate fell by around 1 percent in the past week, with the biggest drop last Monday, the highest since the end of January. The exchange rate remained unchanged after BI’s announcement.
BI’s decision was taken ahead of a review of US monetary policy by the Federal Reserve (Fed).
The Fed is not expected to cut lending rates this week, but markets will pay attention to comments from US central bankers about when monetary policy will be eased.
Bank Indonesia sees room to cut its benchmark interest rate in the second half of 2024.
Inflation is predicted to remain within target until 2025, although stimulus is needed amid declining exports.
Some economists predict BI will follow signals from the Fed regarding when and how much to cut interest rates.
BI also maintains Indonesia’s economic growth projection for 2024 in the range of 4.7 percent to 5.5 percent.
