Jakarta (ANTARA) - Bank Indonesia (BI) Governor Perry Warjiyo said the central bank was reluctant to raise its benchmark interest rate (BI-Rate), but has done so to attract foreign portfolio investment inflows into the country.

On Tuesday, through its weekly Board of Governors Meeting (RDG), BI decided to raise the BI-Rate by 25 basis points (bps) to 5.5 percent.

“Today we raised it again to 5.5 percent. We do not like raising interest rates, but (did so) to attract foreign portfolio investment,” he said during a working meeting with the House of Representatives’ Budget Committee here on Tuesday.

BI recently raised the BI-Rate by 50 bps at its monthly RDG on May 19-20.

The increase marked the first adjustment after the benchmark rate was held at 4.75 percent since September 2025.

Throughout 2025, BI had previously cut the benchmark rate five times, totaling a 125 bps reduction.

BI is scheduled to hold its next monthly RDG on June 17-18.

In addition to interest rate adjustments, Warjiyo outlined other measures aimed at maintaining rupiah exchange rate stability, including continued foreign exchange interventions in both offshore Non-Deliverable Forward (NDF) markets and onshore spot and Domestic Non-Deliverable Forward (DNDF) transactions.

BI also ensures that foreign exchange reserves remain more than sufficient to maintain rupiah exchange rate stability.

Furthermore, BI said it is boosting foreign capital inflows by increasing the interest rate structure of Bank Indonesia Rupiah Securities (SRBI), in coordination with the government so that portfolio investment grows not only in SRBI instruments but also in government bonds (SBN) and the stock market.

In addition, BI has lowered the threshold for cash foreign exchange purchases against the rupiah without underlying documents to US$25,000 per person per month, effective June 2026.

BI is also strengthening supervision of banks and corporations with high US dollar purchasing activity in close coordination with the Financial Services Authority (OJK).


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Translator: Rizka, Kenzu
Editor: Azis Kurmala
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