BI decides to hold its benchmark interest rate at five percent

BI decides to hold its benchmark interest rate at five percent

The Board of Governors of Bank Indonesia in Jakarta, Thursday (1/23/2020). (Antara/Indra Arief/AK)

In future, the BI will continue to implement accommodative policies, coordinate with other agencies to maintain financial system stability, and encourage banking intermediation
Jakarta (ANTARA) - Bank Indonesia (BI) took the decision to hold its benchmark interest rate at five percent and promised that its monetary policy stance remained accommodative to boost the momentum of economic growth and maintain stability.

"In future, the BI will continue to implement accommodative policies, coordinate with other agencies to maintain financial system stability, and encourage banking intermediation," BI Governor Perry Warjiyo remarked in Jakarta on Thursday.

The BI Board of Governors agreed on Jan 22-23, 2020, to hold the BI 7-Day Reverse Repo Rate at five percent while also maintaining the Deposit Facility (DF) and Lending Facility (LF) rates at 4.25 percent and 5.75 percent.

The monetary policy remains accommodative and is consistent with controlled inflation in the target corridor, maintained external stability, as well as efforts to sustain domestic economic growth momentum.

BI will continue to orient monetary operations towards maintaining adequate liquidity and supporting the transmission of an accommodative policy mix. Meanwhile, BI will maintain an accommodative macroprudential policy to stimulate economic financing in line with the suboptimal financial cycle while also giving due consideration to prudential principles.

The payment system policy and financial market deepening will be further bolstered to support economic growth.

Going forward, BI will monitor economic developments on the domestic and global fronts in using its room to apply an accommodative policy mix to maintain controlled inflation and external stability along with supporting the economic growth momentum.

Furthermore, BI will continue to bolster coordination with the government and other relevant authorities to maintain economic stability and catalyze domestic demand while boosting exports and tourism and attracting foreign capital flows, including Foreign Direct Investment (FDI).

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