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.
Tags: Keywords:Related Articles
Who Will Lead Bank Indonesia? Markets Put Independence Above Politics
Markets are watching Indonesia's BI succession, with investors prioritizing credibility and central bank independence over politics.
Higher BI Rate Threatens Investment, Consumer Spending: Think Tank
Core Indonesia says BI's 100-basis-point rate hike may delay investment, curb household spending, and slow bank lending growth.
BI Governor Appointment Seen as Referendum on Central Bank Independence
An economist says markets will judge Indonesia's commitment to central bank independence through the selection of BI's next governor.
KPK Leaves Door Open to Question Former BI Governor Perry Warjiyo in CSR Graft Probe
KPK says it may question former BI governor Perry Warjiyo in the central bank's CSR corruption probe as investigators press on.
Indonesian Stocks Open Lower as BI Leadership Transition, Fed Decision Keep Investors Cautious
Indonesian stocks opened lower as BI's leadership transition and the Fed decision kept investors cautious. JCI slipped 0.16%.
Acting BI Governor Urges Markets Not to Panic After Perry's Resignation
Acting Bank Indonesia Governor Destry Damayanti said monetary policy will remain unchanged following Perry Warjiyo's resignation.
How Indonesia Chooses a New Central Bank Governor
Indonesia's laws require Parliament to approve the president's nominee for Bank Indonesia governor within one month.
Government Says Perry Warjiyo's Resignation Won't Disrupt Monetary Policy
The government says Bank Indonesia's policies and coordination will continue unchanged despite Perry Warjiyo's resignation.
Rupiah Slides Back Above 18,000 per Dollar After Perry Warjiyo Resigns
The rupiah weakened beyond 18,000 per dollar as investors assessed the surprise resignation of Bank Indonesia Governor Perry Warjiyo.
Indonesia Stocks Fall as Perry's Exit Raises Questions Over BI Succession
Indonesia stocks slipped as Perry Warjiyo's resignation fueled uncertainty over Bank Indonesia's leadership despite a broader Asia rally.The Latest
Indonesia Sets August CPO Reference Price at $996.52 per Ton
Indonesia lowered its August CPO reference price to $996.52 per ton, reducing the export duty on palm oil shipments.
Five Dead, 227 Rescued After Ferry Fire Off Madura
At least 227 people have been rescued and five have died after a ferry caught fire off Madura, rescuers say.
AI’s Thirst for Water to Soar 129%, UN Warns
As many as 40% of the data centers in the world are in high-water stress areas, UN envoy Retno Marsudi says.
Philippines Eyes ASEAN Halal Standards
The Philippines is eyeing a halal recognition deal with Indonesia as it seeks regional standards for Sharia-compliant goods.
Ferry Carrying 250 People Catches Fire Off Madura, Rescue Underway
A rescue operation is underway after a ferry carrying about 250 people caught fire off Madura, East Java.Most Popular
