BI Retains BI Rate at 9.5% - Bank Sentral Republik Indonesia
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September 16, 2019

No. 10/54/PSHM/Humas

In the Board of Governors' Meeting convened today, Bank Indonesia resolved to hold the BI Rate at 9.5%. This decision was taken after a comprehensive evaluation of domestic and international developments in the economy and financial sector and the inflation trend.

Faced with the ongoing global financial turmoil and the slowdown taking increasing hold on the world economy, Bank Indonesia places great importance on carefully targeting monetary policy to strike a balance between economic growth and safeguarding of monetary stability. At home, inflationary pressures have begun to ease, although inflation remains strong at 11.77% (yoy).

Allowing for the various risks and inflationary pressure expected last until end of year, Bank Indonesia forecasts CPI inflation at end-2008 in the 11.5%-12.5% (yoy) range before easing to 6.5%-7.5% in 2009. Regarding the exchange rate, Bank Indonesia will stay the course with the rupiah stabilisation policy aimed at preventing excessive volatility.

Banking sector performance remains sound. Key indicators such as the CAR, NPLs and NOP have held their ground amid the market turbulence. Credit expansion has begun to ease while credit risk remains subdued despite the need for continued vigilance. The easing of liquidity conditions in the banking industry has also created more space for banks to pursue business.

Bank Indonesia will optimise the deployment of all monetary policy instruments at its disposal while maintaining close coordination with the Government in monitoring developments and outlook in the global, regional and domestic economy with the aim of safeguarding medium-term economic stability.

A full analysis of economic conditions in October 2008 will be published in the Monetary Policy Review to be made available on the Bank Indonesia website (http://www.bi.go.id) from 13 November 2008.

Jakarta, 6 November 2008
Office of The Governor

Dyah N.K. Makhijani
Director

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