BI to maintain benchmark interest rate at 3.5 percent: Governor

BI to maintain benchmark interest rate at 3.5 percent: Governor

Bank Indonesia Governor Perry Warjiyo. (ANTARA/Agatha Olivia/KT)

Jakarta (ANTARA) - Bank Indonesia (BI) decided to maintain the benchmark interest rate, or the BI 7-Day Reverse Repo Rate (BI7DRR), at 3.5 percent following the outcome of the board of governors' meeting on November 17-18, 2021.

"This decision aligns with the need to maintain the exchange rate and financial system stability amid the low inflation forecasts as well as efforts to support economic growth," BI Governor Perry Warjiyo remarked here on Thursday.

Warjiyo noted that the interest rates of the deposit facility and lending facility were also maintained at 2.75 percent and 4.25 percent, respectively.

In addition, BI continues to optimize the entire policy mix to stabilize the macroeconomic and financial system as well as strive to boost the economy through various measures.

The measures encompass continuing the rupiah exchange rate policy to maintain its stability that follows the market fundamentals and mechanisms, according to Warjiyo.

Related news: BI holds benchmark rates at 3.5% to maintain stability

Warjiyo noted that the second policy was aimed at strengthening strategies pertaining to monetary operations to boost effectiveness of the accommodative monetary policy stance.

The governor affirmed that BI will support transparency of the Prime Lending Rate (SBDK) by deepening its analysis on the largest bank groups that have a 70-percent credit share of the industry.

Finally, BI will proceed to maintain the merchant discount rate of the Quick Response Code Indonesian Standard (QRIS) for Micro, Small, and Medium Enterprises (MSMEs) to zero percent until June 30, 2022. This policy regarding the QRIS discount rate for merchants aims to protect the acceptance and use of QRIS.

Furthermore, the central bank will continue to conduct promotional activities and trade investment in Japan, the UK, China, the US, Russia, Brunei Darussalam, and Singapore in November and December this year as well as disseminate information on the use of local currency settlement (LCS) in collaboration with relevant agencies.

"BI will reinforce and synergize policy with the government and the Financial System Stability Committee (KSSK) in order to maintain the financial system stability and increase financing credit to businesses and priority sectors to encourage economic growth, export, and financial inclusion," Warjiyo expounded. 

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