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25 Apr 2025

International Economy

BI maintains its policy rate at 5.75% amid concerns over the Rupiah being Asia’s worst-performing currency (Business Brief No.4147 Full Ed.)

คะแนนเฉลี่ย
  • The Rupiah has become the worst-performing currency in Asia, pressuring Bank Indonesia (BI) to hold its policy rate steady at 5.75 percent for the third consecutive month during its April 22-23 meeting. In recent months, BI has deployed monetary tools to intervene in the market in an effort to stabilize the currency and mitigate the impact of reciprocal tariffs. However, such a measure is likely to provide only short-term relief. In the long term, restoring investor confidence in the government’s economic management will be key to halting asset sell-offs and capital outflows.
  • KResearch views that while low inflation typically supports monetary easing, downward pressure on the Rupiah and uncertainty surrounding the now-suspended reciprocal tariffs remain major obstacles to rate cuts in the near term. Nonetheless, if confidence in the financial market begins to recover, and the currency becomes more stable in the second half of the year, BI may cut its policy rate once or twice to support economic growth.

International Economy