According to reporting from Tempo, Indonesia’s state bank, Bank Indonesia (BI) has finally raised its benchmark interest rate to 6.25 percent. BI announced the decision in a press conference on the results of its Board of Governors meeting on Wednesday (24/4/24.)
“The BI Board of Governors meeting on April 23 to 24 decided to raise the BI rate by 25 basis points to 6.25 percent,” BI Governor Perry Warjiyo said.
BI raised the deposit facility rate to 5.50 percent. Meanwhile, the lending facility rate was raised by 7 percent, says Tempo.
“This increase in interest rates is to strengthen the stability of the rupiah exchange rate against the possibility of worsening global risks,” Perry said.
The BI rate hike is also a pre-emptive and forward-looking measure to ensure that inflation remains within the target range of 2.5 percent, ±1, for this year and 2025, which aligns with the pro-stability monetary policy.
In terms of macroprudential policy and payment systems, he continued, Bank Indonesia remains pro-growth to support sustainable economic growth. Perry stated that the central bank continues to pursue macroprudential policies to encourage banks to lend and finance both businesses and households, report Tempo.
Source: Tempo
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