Citing a need to stand guard against inflation, Bank Indonesia held policy interest rates unchanged at its just-concluded two-day policy meeting, the central bank said Wednesday.
Bank Indonesia held its key interest rate unchanged at 6.00%, and the deposit facility rate at 5.25%, and the lending facility rate at 6.75%.
The decision to leave rates unchanged "is consistent with the direction of monetary policy to ensure inflation remains under control within the target of 2.5% plus or minus 1% in 2024 and 2025, and to support sustainable economic growth," said Bank Indonesia.
The central bank also cited a need for stability in the international exchange rate of the nation's currency, the rupiah.
Bank Indonesia said it would strengthen "the stability of the rupiah exchange rate from the impact of heightened global economic uncertainty due to the direction of US policy and the escalation of geopolitical tensions in various regions."
Despite international challenges, Bank Indonesia maintained its relatively robust predictions for growth of Indonesia's gross domestic product (GDP).
"Overall, (Indonesian) economic growth in 2024 is predicted to be in the range of 4.7% to 5.5% and increase to 4.8% to 5.6% in 2025," advised Bank Indonesia.
Indonesian inflation rates should remain within target in 2024 and next year, said Bank Indonesia.
The nation's consumer price index (CPI) in November was up a modest 1.55% on year, although the core inflation rate, that excludes certain food and government-controlled prices, rose 2.26% on year in the month.
Bank Indonesia has an annual inflation target on the nation's CPI of 2.5% plus or minus 1%.
"Going forward, Bank Indonesia believes that CPI inflation will remain under control within its target," said the central bank citing adequate capacity within the economy to answer rising demand.
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