BI Rate Raised Amidst External Pressures

External pressures such as the uncertainty in global financial markets have led to the raise of BI’s interest rate on Thursday, May 17th 2018.

As many have predicted in the past months, Bank Indonesia has finally raised their benchmark interest rate on Thursday (5/17). The reason behind Bank Indonesia’s rate hike are stated to be primarily due to external pressures, including the looming uncertainty in global financial markets.

Bank Indonesia’s 7-day reverse repo rate was increased by 25 points to 4.5 percent and the lending and deposit rates were increased 25 points to 5.25 percent and 3.75 percent. It also affected the economic growth outlook at 5.1-5.5 percent. Agus Martowardojo, the Governor of Bank Indonesia, said that the national bank will continue to pay attention to the economic growth and is ready to take stronger measures to ensure that