Financial News: Indonesia Central Bank Keeps Key Rates Unchanged

Indonesia Central Bank Keeps Key Rates Unchanged

02/19/2025 - 04:42:00 (RTTNews)

(RTTNews) - Indonesia's central bank left its interest rate unchanged on Wednesday after cutting the rate by a quarter-point last month, and hinted at further reduction this year.

The Bank Indonesia Board, led by Governor Perry Warjiyo, decided to maintain the BI rate at 5.75 percent, as widely expected.

The bank had reduced the rate in January, which was the first reduction since September 2024. The deposit facility rate and the lending rate were maintained at 5.00 percent and 6.50 percent, respectively.

The board said they will continue to monitor the rupiah exchange rate, inflation and economic growth to assess the room for lowering the interest rate further.

Bank Indonesia projected economic growth in the range of 4.7-5.5 percent this year. CPI inflation is expected to remain under control within the target of 1.5 to 3.5 percent.

Capital Economics' economist Gareth Leather said the central bank will cut rates steadily throughout 2025. Leather forecasts 150 basis points of cuts this year.

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