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Bank Indonesia Pauses Hikes, Keeps Interest Rates Unchanged

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Bank Indonesia kept its key interest rates unchanged on Wednesday following the conclusion of its Board of Governors' meeting.

The central bank left the 7-day reverse repurchase rate, or BI rate, unchanged at 5.75%, while also maintaining the deposit facility rate at 4.75% and the lending facility (LF) rate at 6.50%.

According to a Reuters poll, 20 of 33 economists it surveyed had expected another 25-basis-point (bps) hike, while the rest had predicted no change.

In a statement, Bank Indonesia said it is expanding its incentive policy and introducing more measures to increase foreign portfolio inflows, strengthen Rupiah exchange rate stability, and accelerate money market and foreign exchange market deepening.

It is also working on increasing liquidity and reducing liquidity segmentation in the money market and banking industry.

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