Bank Indonesia unexpectedly lowered its key interest rate by 25 basis points to 5.75 percent, aiming to boost economic growth and support the weakening rupiah. This is the first rate cut since September and comes despite recent efforts to strengthen the currency. The central bank cited a shift in policy to prioritize stability and growth, projecting slower economic expansion in 2025 compared to the previous year.
JAKARTA — Indonesia's central bank unexpectedly announced a cut in its key interest rate on Wednesday in a bid to boost economic growth and a weakening rupiah.Bank Indonesia lowered the benchmark seven-day reverse repurchase rate by 25 basis points to 5.75 percent, citing a shift in policy to bolster stability and growth.Its two other main rates were also cut by 25 basis points.
Warjiyo said Bank Indonesia projected that economic growth would be slower in 2025 compared to last year.The central bank had steadily increased borrowing costs to defend the rupiah amid growing global economic uncertainty and rising inflation.London-based business research center, Capital Economics, called the move a major surprise.
ECONOMY INTEREST RATES INDONESIA BANK INDONESIA RUPIAH
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