In line with expectations, the central bank of Indonesia (Bank Indonesia) decided to leave its benchmark interest rate – the BI 7-Day Reverse Repo Rate – unchanged at 6.00 percent, while also maintaining its deposit facility and lending facility rates at 5.25 percent and 6.75 percent, respectively, at the two-day monthly monetary policy meeting that was held on 19 and 20 June 2019.
Despite the US Federal Reserve having been dovish since the end of 2018 (and despite rising expectations that the Fed will cut its key rate in the foreseeable future, possibly even more than once), Bank Indonesia saw no opportunity yet to cut interest rates in June because external conditions have remained very uncertain, while Indonesia’s current account deficit widened in the first quarter of 2019.
Read the full article in the June 2019 edition of our monthly research report. You can purchase the report by sending an email to email@example.com or a WhatsApp message to the following number: +62(0)8788.410.6944
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