Bank Indonesia Maintains BI Rate at 4.75%, Signals Room to Cut
Jakarta. Bank Indonesia kept its benchmark interest rate unchanged in February, maintaining a cautious stance to safeguard rupiah stability while sustaining inflation control and economic growth momentum.
Following its Feb. 18–19 policy meeting, the central bank left the BI Rate at 4.75%, with the Deposit Facility rate at 3.75% and the Lending Facility rate at 5.5%.
Governor Perry Warjiyo said the decision aligns with the central bank’s priority to reinforce exchange-rate stability amid persistent global economic uncertainty, while ensuring inflation remains within target and supporting growth.
“This policy is consistent with efforts to strengthen rupiah stability in the face of global economic uncertainty, while supporting the achievement of the 2026 and 2027 inflation targets and encouraging economic growth,” Perry said during a virtual press conference on Thursday.
Bank Indonesia signaled that room for further rate cuts remains open, citing expectations that inflation in 2026–2027 will stay within the 2.5±1% target range.
“Bank Indonesia continues to assess the possibility of further BI Rate reductions, supported by controlled inflation projections for 2026 and 2027 and the need to promote stronger economic growth,” Perry added.
Beyond interest-rate policy, the central bank is steering its macroprudential stance toward accelerating credit expansion and financing to the real sector, particularly government priority industries. It is also pushing banks to lower lending rates more quickly through the Macroprudential Liquidity Incentive Policy (KLM).
Meanwhile, payment-system policy remains focused on inclusive growth by expanding digital payment acceptance, strengthening industry structure, and improving infrastructure resilience.
“The overall direction of monetary, macroprudential, and payment-system policy is aimed at maintaining stability while fostering sustainable economic growth,” Perry said.
Since September 2024, Bank Indonesia has cut the BI Rate by a cumulative 150 bps, including 25 bps in September 2024 and 125 bps throughout 2025, bringing the benchmark to 4.75% by December 2025, its lowest level since 2022.
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