Indonesia’s central bank keeps rates steady, focuses on rupiah’s stability
JAKARTA — Indonesia’s central bank held its policy rates unchanged for a third straight meeting on Wednesday, maintaining its focus on supporting the rupiah currency while it assesses the impact of its earlier easings.
Bank Indonesia (BI) kept the benchmark 7-day reverse repurchase rate at 4.75%, as expected by 18 of 31 economists polled by Reuters. The rest had predicted BI would resume its rate cut cycle.
The bank also left unchanged its overnight deposit rate and lending rate at 3.75% and 5.5%, respectively. BI had slashed its main rates by a total of 150 bps between September 2024 and September 2025 as it looked to stimulate growth in Southeast Asia’s biggest economy.
Governor Perry Warjiyo said in an online press conference the decision was in line with efforts to maintain the stability of the rupiah as global market uncertainties remain high, while the central bank continues to monitor if it has room for further policy rate easing.
BI has forecast growth of 4.9% to 5.7% next year, from 4.7% to 5.5% in 2025.
The rupiah has been among emerging Asia’s weakest currencies against the dollar this year. Hoping to increase domestic US dollar supply to bolster the rupiah, the government has said it would change export earnings retention rules to make exporters keep their dollars onshore for longer from next year.
Inflation has remained comfortably within the central bank’s 1.5% to 3.5% target range for most of the year, with the November rate at 2.72%. BI expects inflation to stay anchored next year. — Reuters
