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No. 28/233/DKom  

The Bank Indonesia Board of Governors Meeting on 20^th-21^st October 2026 decided to hold the BI-Rate at 5.75% and the Lending Facility rate at 6.50%, while raising the Deposit Facility rate to 5.00%. This decision was reinforced by stronger policy incentives for Domestic Non-Deliverable Forward (DNDF) hedging instruments with Bank Indonesia to attract foreign capital inflows and maintain Rupiah exchange rate stability, while accelerating money market and foreign exchange market deepening. This monetary policy remains consistent with the strategy to stabilise the Rupiah exchange rate amid persistently strong external headwinds and maintain inflation within the 2.5±1% target range in 2026 and 2027. Moving forward, Bank Indonesia will continue optimising various monetary policy instruments to strengthen external resilience, including taking the necessary adjustment measures to consistently maintain economic stability. Meanwhile, macroprudential policy and payment system policy remain oriented towards maintaining economic growth momentum. Bank Indonesia continues to strengthen accommodative macroprudential policy to increase lending/financing to the real sector, while maintaining financial system stability. Payment system policy also remains directed towards supporting economic activity through broader acceptance of digital payments, stronger risk management in payment services, as well as enhancing the reliability and resilience of payment system infrastructure. 

The direction of the monetary, macroprudential and payment system policy mix to strengthen stability, while supporting sustainable economic growth, is further bolstered through the following policy measures:

​Bank Indonesia continues strengthening policy coordination with the Government, Financial System Stability Committee (KSSK) and other stakeholders to bolster external resilience, maintain economic stability and support sustainable economic growth. 

The global economic outlook remains subdued amid persistently high financial market uncertainty. Such conditions are influenced by escalating tensions associated with the ongoing war in the Middle East, thereby perpetuating high oil prices and prices of various international commodities. Global economic growth in 2026 is projected to remain weak at around 3.0%, accompanied by persistently high inflationary pressures of approximately 4.6%. Tight global monetary policy is expected to persist for longer (higher for longer), including a strong likelihood of a further increase in the US monetary policy rate, the Federal Funds Rate (FFR). US Treasury yields also remain high in line with stronger expectations concerning the future direction of US monetary policy and the large US Government fiscal deficit. In global financial markets, investor preference for portfolio assets in emerging markets remains subdued, thereby sustaining a strong US dollar against advanced economy currencies (DXY) and emerging market currencies. Such conditions demand a stronger policy response and closer fiscal-monetary policy synergy to bolster external resilience, maintain stability and drive domestic economic growth. 

Economic growth in Indonesia remains resilient and must continue to be strengthened by optimising various sources of economic growth. Recent developments indicate that household consumption has been maintained, supported by ongoing fiscal stimulus measures and improving consumer expectations. Investment has also maintained positive growth, primarily underpinned by government investment and an increasingly significant contribution from private investment in line with stronger producer confidence, as reflected by the expansionary Manufacturing Purchasing Managers' Index (PMI). On the external side, non-oil and gas export performance improved, although further efforts are required to capitalise on the momentum of rising export commodity prices. Moving forward, economic growth in Indonesia is projected to remain solid, supported by ongoing government stimulus measures, improving confidence among economic players and stronger contributions from various sources of economic growth. Bank Indonesia projects national economic growth within the 4.9-5.7% range in 2026. 

Indonesia's Balance of Payments (BOP) performance must continue to be strengthened to bolster external resilience amid persistently high global uncertainty. The trade balance in August 2026 recorded a USD3.55 billion surplus, increasing from a USD0.12 billion surplus in the previous month. Meanwhile, foreign portfolio investment in the third quarter of 2026 recorded net outflows of USD0.08 billion, primarily attributable to equity outflows amid persistently high global financial market uncertainty. Equity outflow pressures continued in October 2026, while Bank Indonesia Rupiah Securities (SRBI) and Government Securities (SBN) recorded inflows. Consequently, foreign portfolio investment in the fourth quarter of 2026 (as of 19^th October 2026) recorded net inflows of USD0.66 billion. Indonesia's international reserves remained solid at USD146.3 billion at the end of September 2026, equivalent to 5.3 months of imports or 5.2 months of imports and servicing government external debt, which is well above the international adequacy standard of approximately 3 months of imports. Moving forward, external resilience is expected to remain solid, with the current account deficit in 2026 projected within the 2.4-1.6% of GDP range. 

Bank Indonesia continues strengthening various policies to maintain Rupiah exchange rate stability against the impact of global volatility. After appreciating through to mid-September 2026, the Rupiah was recorded at Rp17,985 per US dollar on 20^th October 2026, depreciating by 0.61% (ptp) compared with the position at the end of September 2026. Such developments were influenced by escalating geopolitical tensions in the Middle East, a tightening of US monetary policy and foreign investor sentiment in the equity market. Bank Indonesia remains firmly committed to maintaining Rupiah exchange rate stability by continuing to optimise the full range of monetary instruments, including strengthening incentive policies to increase foreign portfolio investment inflows and accelerate money market and foreign exchange market deepening. These incentives are provided not only for Conventional Hedging Buy Swap and DNDF instruments with Bank Indonesia, but also for Local Currency Transactions (LCT) with partner countries, thereby maintaining attractive yields on rupiah-denominated assets. Since implementation in June 2026, these policies have successfully attracted foreign capital inflows totalling USD9.9 billion (as of 20^th October 2026). Moving forward, Bank Indonesia expects the Rupiah to remain stable, supported by Bank Indonesia's firm commitments, attractive yields, inflation maintained within the target corridor and the promising domestic economic outlook. 

Consumer Price Index (CPI) inflation remained within the target corridor. CPI inflation in September 2026 was recorded at 3.28% (yoy), up from 3.19% (yoy) in the previous month. Contained inflation was supported by lower core inflation of 2.84% (yoy), consistent with Bank Indonesia's policy commitment to controlling inflation, as well as moderating administered prices (AP) inflation of 3.25% (yoy), primarily due to lower airfares. Meanwhile, volatile food (VF) inflation increased to 5.03% (yoy), influenced by lower production in several major production hubs, particularly due to weather disruptions. Moving forward, Bank Indonesia will continue strengthening its monetary policy mix response, including Rupiah exchange rate stabilisation, to maintain inflation within the 2.5±1% target range in 2026 and 2027. Bank Indonesia also continues strengthening synergy with the Government through the Central/Regional Inflation Control Teams (TPIP/TPID) in implementing the Inflation Control and Food Prosperity Movement (GPIPS) to control food inflation. 

Banking intermediation remained solid, supported by maintained banking resilience. Bank lending growth was recorded high at 13.26% (yoy) in September 2026, supported by investment loans, working capital loans and consumer loans, which grew by 23.20% (yoy), 11.89% (yoy) and 4.86% (yoy), respectively. Lending to corporations unrelated to Government programs also increased. Significant opportunities for further credit growth remain available, as reflected by sizeable undisbursed loan facilities totalling Rp2,562.57 trillion, equivalent to 21.70% of available credit lines. Meanwhile, third-party funds (TPF) growth was lower at 8.22% (yoy), requiring further strengthening to support credit growth. Bank Indonesia projects credit growth within the 8-12% range in 2026. Banking resilience also remained solid overall, with the Capital Adequacy Ratio (CAR) of the banking industry recorded high at 24.10% in August 2026. As an aggregate, Non-Performing Loans (NPL) in the banking industry remained low at 2.11% (gross) and 0.84% (net) in August 2026. Moreover, the Liquid Assets to Third-Party Funds (LA/TPF) ratio increased from 23.04% in August 2026 to 24.08% in September 2026. 

Bank Indonesia continues to strengthen accommodative macroprudential policy to increase lending/financing to the real sector, while maintaining financial system stability. Positive credit developments were supported by the accommodative macroprudential policy stance maintained through optimisation of the Macroprudential Liquidity Incentive Policy (KLM) to stimulate bank lending/financing to priority sectors. As of the first week of October 2026, KLM incentives received by banks amounted to Rp458.5 trillion, consisting of Rp336.4 trillion allocated through the KLM financing channel and Rp122.1 trillion through the money market deepening channel (KLM PPU). Implementation of KLM PPU has encouraged liquidity redistribution in the banking industry and increased transactions in the Rupiah money market. Bank Indonesia will continue optimising KLM implementation to improve the effectiveness of lending/financing disbursements, while prioritising prudential principles. 

Digital economic and financial transactions continued to grow in the third quarter of 2026, underpinned by secure and seamless payment systems as well as stable infrastructure. Digital payment[3] transaction volume reached 18.09 billion transactions in the third quarter of 2026, growing by 39.24% (yoy), supported by broader acceptance of digital payments. Transaction volumes through internet payments and mobile payments grew by 14.26% (yoy) and 45.55% (yoy), respectively, including QRIS transactions, which continued to enjoy robust growth of 75.80% (yoy), supported by an increase in the number of users and merchants to 70.6 million and 49.4 million, respectively. On the infrastructure side, retail transaction volumes processed through BI-FAST reached 1,631 million transactions, growing by 31.78% (yoy), with a transaction value of Rp4,049 trillion, increasing by 33.91% (yoy). Meanwhile, BI-RTGS transaction value reached Rp53,817 trillion, contracting slightly by 4.62% (yoy), with transaction volume recorded at 2.79 million transactions, up by 1.31% (yoy). In terms of Rupiah currency management, currency in circulation grew by 11.77% (yoy) to Rp1,341 trillion. Furthermore, Bank Indonesia continues maintaining the availability of Rupiah currency in sufficient quantities and fit for circulation throughout the territory of the Republic of Indonesia, including frontier, outermost and remote (3T) areas.

Jakarta, 21^st October 2026
Communication Department
Ramdan Denny Prakoso
Executive Director

¹ Initially, applicable to USD and RMB (CNY and CNH).

² Bank Indonesia has implemented LCT cooperation with seven (7) partner countries, namely Japan, South Korea, Malaysia, Singapore, Thailand, China and the United Arab Emirates.

³ Digital payments consist of transactions through mobile banking and internet banking, as well as transactions using server-based electronic money.