Indonesia Interest Rate  2005-2017 | Data | Chart | Calendar | Forecast

The central bank of Indonesia unexpectedly lowered its benchmark interest rate by 25bps to 4.5 percent on August 22nd of 2017, compared with market expectations of no changes. It is the first cut in borrowing cost since October, aiming to strengthen banking intermediary function and support economic growth. The lending and the deposit facility rates were also lowered by 25bps each to 5.25 percent and 3.75 percent respectively. Interest Rate in Indonesia averaged 7.35 percent from 2005 until 2017, reaching an all time high of 12.75 percent in December of 2005 and a record low of 4.50 percent in August of 2017.

Indonesia Interest Rate
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Indonesia Cuts Key Rate to 4.5%


The central bank of Indonesia unexpectedly lowered its benchmark interest rate by 25bps to 4.5 percent on August 22nd of 2017, compared with market expectations of no changes. It is the first cut in borrowing cost since October, aiming to strengthen banking intermediary function and support economic growth. The lending and the deposit facility rates were also lowered by 25bps each to 5.25 percent and 3.75 percent respectively.

Excerpts from the Bank Indonesia Press Release:

The BI Board of Governors agreed on 21st - 22nd August 2017 to lower the BI 7-day Reverse Repo Rate 25 basis points (bps) from 4.75% to 4.50%, while also lowering the Deposit and Lending Facility rates 25 bps to 3.75% and 5.25% respectively, effective 23rd August 2017. This will be followed by a decrease in interest rates on other monetary instruments.The decision was consistent with the rooms for monetary policy easing, as evidenced by low inflation with 2017 and 2018 inflation projected within the target range, and current account deficit under control within a healthy range. External risks, relating to the Fed hiking its Fed Funds Rate (FFR) and unwinding its balance sheet, have decreased, resulting in the still-attractive domestic interest rate in Indonesia, compared to the external interest rate. The policy rate easing is expected to reinforce intermediation in the banking sector, to strengthen financial system stability as well as support higher economic growth. Bank Indonesia constantly strengthens its mix of monetary, macroprudential and payment system policy to maintain macroeconomic and financial system stability. Furthermore, Bank Indonesia will continue to strengthen coordination with the Government and other authorities to ensure that inflation control, growth stimulus, and structural reforms are going well enough to support sustainable economic growth.

Moving forward, economic growth is expected to improve on the back of increased investment and consumption activities, in line with more expansive government spending and additional rooms to ease monetary policy. Bank Indonesia predicts growth in the 5.0% - 5.4% range for 2017 and 5.1%-5.5% range for 2018.

Moving forward, inflation is expected to remain low within target, on the back of adequate supply compared to demand (output discrepancy), stable exchange rate, global trend of decreased inflation, and low risk in administered prices hike. Bank Indonesia will continue to strengthen coordination with the central government and regional administrations to maintain stable and low inflation.

Banking intermediation is expected to improve in 2018,with credit and deposit growth expected at 10-12% and 9-11%, respectively. To support economic funding as well as financial market deepening, Bank Indonesia with related authorities will speed up consolidation process in the banking sector while promoting credit distribution and corporate funding through financial markets. The policy, along with policy rate easing, is aimed at boosting an optimum banking intermediation to support national economic recovery.

Bank Indonesia l Joana Taborda | joana.taborda@tradingeconomics.com
8/22/2017 4:38:54 PM



Calendar GMT Actual Previous Consensus TEForecast
2017-06-15 09:30 AM Interest Rate Decision 4.75% 4.75% 4.75% 4.75%
2017-07-20 07:30 PM Interest Rate Decision 4.75% 4.75% 4.75% 4.75%
2017-08-22 11:35 AM Interest Rate Decision 4.5% 4.75% 4.75% 4.75%
2017-09-22 09:00 AM Interest Rate Decision 4.5% 4.5%
2017-10-19 09:00 AM Interest Rate Decision 4.5%
2017-11-16 09:00 AM Interest Rate Decision 4.5%


Indonesia Money Last Previous Highest Lowest Unit
Interest Rate 4.50 4.75 12.75 4.50 percent [+]
Interbank Rate 5.42 5.42 57.79 4.19 percent [+]
Money Supply M0 516929.35 561856.55 561856.55 2983.00 IDR Billion [+]
Money Supply M1 1283751.20 1395312.30 1395312.30 317.90 IDR Billion [+]
Money Supply M2 5166441.90 5278918.40 5278918.40 5156.00 IDR Billion [+]
Foreign Exchange Reserves 128787.06 127758.58 128787.06 27404.30 USD Million [+]
Loans to Private Sector 3993982.00 4018942.00 4018942.00 286724.00 IDR Billion [+]
Deposit Interest Rate 7.20 8.30 39.07 5.95 percent [+]
Cash Reserve Ratio 6.50 6.50 8.00 5.00 percent [+]
Lending Rate 5.25 5.25 15.75 5.25 percent [+]
Loan Growth 8.20 7.70 90.50 -59.90 percent [+]


Indonesia Interest Rate

In Indonesia the interest rate decisions are taken by The Central Bank of Republic of Indonesia. In April of 2016, policymakers announced the replacement of the official discount interest rate with new 7-day reverse repurchase rate in August 2016. This is the rate at which central banks lend or discount eligible paper for deposit money banks, typically shown on an end-of-period basis. This page provides - Indonesia Interest Rate - actual values, historical data, forecast, chart, statistics, economic calendar and news. Indonesia Interest Rate - actual data, historical chart and calendar of releases - was last updated on September of 2017.

Actual Previous Highest Lowest Dates Unit Frequency
4.50 4.75 12.75 4.50 2005 - 2017 percent Daily




interest rate by Country

Last
Russia 8.50 Sep/17
Brazil 8.25 Sep/17
Turkey 8.00 Sep/17
Mexico 7.00 Aug/17
India 6.00 Aug/17
Indonesia 4.50 Aug/17
China 4.35 Aug/17
Australia 1.50 Sep/17
South Korea 1.25 Aug/17
United States 1.25 Sep/17
Canada 1.00 Sep/17
United Kingdom 0.25 Sep/17
Euro Area 0.00 Sep/17
France 0.00 Sep/17
Germany 0.00 Sep/17
Italy 0.00 Sep/17
Netherlands 0.00 Sep/17
Spain 0.00 Sep/17
Japan -0.10 Aug/17
Switzerland -0.75 Sep/17