Indonesia Interest Rate

The Bank of Indonesia kept its interest rate at 6% during its October 2024 meeting to ensure that inflation moves towards its target of 2.5% ± 1% for 2024-2025 while supporting economic growth, and matching market expectations. This decision followed a surprise 25 bps reduction in September, the first cut in borrowing costs since January 2021. Governor Perry Warjiyo said the decision was influenced by rising global market uncertainties. He added that the BI will continue to assess the possibility of further rate cuts, considering the country's inflation, Rupiah stability, and growth outlook. The annual inflation rate fell to a near three-year low of 1.84% in September, within the BI's target range of 2.5% ± 1%. Meanwhile, the Rupiah depreciated by 2.82% in October 2024 (as of October 15, 2024). Additionally, the central bank maintained its economic growth forecast at around 4.7-5.5% for this year. The overnight deposit and lending facility rates were also held at 5.25% and 6.75%, each.