Wednesday, August 23, 2017

FW: RHB | Indonesia | BI Cuts Key Policy Rate, Maintains Neutral Stance




Economic Research

23 August 2017



Economic Update




BI Cuts Key Policy Rate, Maintains Neutral Stance


Bank Indonesia’s (BI) board of governors unexpectedly cut the 7-day (reverse) repo rate – the benchmark policy rate – by 25bps to 4.5% on 22 Aug. As risks of financial volatility linger, we believe the Central Bank would maintain its key policy rate for the rest of 2017.

Deposit facility and lending rates were also cut to 3.75% and 5.25% respectively. BI believes the decision is consistent with there being room for further monetary policy easing, as evidenced by relatively low inflationary pressure in 2017, while 2018 inflation is projected to be within the target range. Also, the country’s current account deficit appears to be well under control.



Economist:  Rizki Fajar| +6221 2970 7065



To access our recent reports please click on the links below:

16 Aug: Exports And Imports Rebounded in July After Festivities

14 Aug: CAD Continues To Widen In 2Q17, BOP Surplus Declines

08 Aug: Economic Growth Sustained In 2Q17

02 Aug: July Inflation Eases Off After Aidil Fitri Festivities

01 Aug: June M2 Growth Picks Up, Loan Growth Moderates

21 July: BI Continues To Hold Key Policy Rate In July


Economics Team





Peck Boon Soon

Chief ASEAN Economist

+603 9280 2163

Vincent Loo Yeong Hong

Malaysia, Vietnam

+603 9280 2172

Ng Kee Chou

Singapore, Thailand

+603 9280 2179

Rizki Fajar

Indonesia, Philippines

+6221 2970 7065

Aris Nazman Maslan

Malaysia, Vietnam

+603 9280 2184




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