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22 May 2025

International Economy

Subsiding pressures on Rupiah allow BI to cut its interest rate to 5.50%, cushioning the slowing economy (Business Brief No.4158 Full Ed.)

คะแนนเฉลี่ย
  • Bank Indonesia (BI) has resumed its monetary easing measures by cutting the policy rate by 0.25 percent to 5.50 percent, marking the lowest level in more than two years. This move aligned with market expectations as the Indonesian Rupiah’s improved trajectory provided space for rate cuts to cushion the slowing economy.
  • KResearch advises close monitoring of ongoing US-Indonesia tariff reduction negotiations, which could impact economic stimulus measures in 2H25. While inflation is projected to remain low in 2025, supporting resumed monetary easing, BI may still prioritize Rupiah stability. Should the currency maintain its resilience, BI may implement at least one more rate cut this year to bolster economic growth.

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International Economy