JAKARTA: Bank Indonesia (BI) has increased its benchmark interest rate by 50 basis points (bps) to stabilise the rupiah, blaming the recent depreciation of the Indonesian currency on external pressure.
BI Governor Perry Warjiyo announced in a press conference on Wednesday (May 20) that the decision was taken as “a further step to strengthen the stabilisation of the rupiah exchange rate against the impact of heightened global volatility” triggered by the United States-Israeli war on Iran.
He added that the move was also a “pre-emptive measure” to keep inflation within the government’s target range of 2.5 plus/minus 1 per cent in 2026 and 2027.
The rupiah strengthened on the news, rising to around 17,600 against the US dollar after touching 17,800 earlier in the day, a record low. - The Jakarta Post/ANN
