Bank Indonesia cuts reserve ratio in cautious easing move

After 100 basis points of rate cuts since July, the central bank is taking a more cautious approach in providing stimulus to the economy, turning to additional instruments to spur lending.

JAKARTA: Indonesia’s central bank left its key interest rate unchanged while pumping more liquidity into the financial system to stimulate Southeast Asia’s largest economy.

Bank Indonesia kept the seven-day reverse repurchase rate unchanged at 5% on Thursday following four rate cuts this year, in line with the prediction of 21 of 31 economists surveyed by Bloomberg.

Banks’ reserve requirement ratio was cut by 50 basis points, the first such decision since June.