Bank Indonesia holds rate steady to guard vulnerable currency

“The decision is consistent with the need to maintain the exchange rate and financial system amid low inflation, and for the economy to recover from the pandemic impact,” governor Perry Warjiyo (pic) said at a briefing in Jakarta. BI’s monetary policy will remain loose and accommodative, he said.

JAKARTA: Indonesia’s central bank left its benchmark interest rate at a record low to protect the currency amid uncertainty about the course of the pandemic, and said it had formulated a plan to deal with eventual United States policy tightening.

Bank Indonesia (BI) kept the seven-day reverse repurchase rate at 3.5% yesterday, as all 28 analysts in a Bloomberg survey expected. Interest rates have been on hold since February’s 25-basis point reduction, and are widely expected to stay at this level throughout 2021.