The Jakarta Post
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.
Popular Reads
Top Results
No results found. Please check your search term and try again
Can't find what you're looking for?
View all search results
Popular Reads
Top Results
No results found. Please check your search term and try again
Can't find what you're looking for?
View all search resultsBI keeps interest rate unchanged despite external pressure
Change text size
Gift Premium Articles
to Anyone
Share the best of The Jakarta Post with friends, family, or colleagues. As a subscriber, you can gift 3 to 5 articles each month that anyone can read—no subscription needed!
Set as preferred source
The Bank Indonesia logo adorns the gate of the central bank's headquarters in Jakarta in this undated photograph. (Antara/File)
B
ank Indonesia (BI) has kept its benchmark interest rate unchanged despite high global energy prices and a recent hike by the United States Federal Reserve (Fed), while relying on hedging to protect the rupiah.
Following the central bank’s monthly two-day policy meeting, BI Governor Destry Damayanti announced in a press conference on Wednesday that the BI rate would remain at 5.75 percent, where it has stood since June.
The move had been predicted by numerous analysts.
“This decision is consistent with the strategy to stabilize the rupiah exchange rate amid strong external pressure to keep inflation within the government’s target range of 2.5 plus/minus 1 percent in 2026 and 2027 and to push for sustained economic growth,” said Destry.
The central bank has now left its key interest rate unchanged for three consecutive months, after multiple rate hikes totaling 100 basis points (bps) in May and June, when it needed to stabilize the battered rupiah amid what it called “heightened global volatility” triggered by the Iran war.
The currency hit a historic low of 18,209 per dollar in June, before bouncing back after the rate increases. It is currently hovering around 17,800.
To stabilize the rupiah and maintain its liquidity, the central bank aims to attract foreign inflows, such as portfolio investment, offshore bank loans and foreign direct investment (FDI), by increasing incentives for conventional hedging swaps and domestic nondeliverable forward (DNDF) transactions.
