Thursday, June 9, 2011

Bank Indonesia Holds Interest Rate at 6.75%

Indonesia's central bank, Bank Indonesia, held the BI reference rate unchanged at 6.75%.  The Bank said: "Bank Indonesia will strengthen the policy mix of monetary and followed-up macroprudential measures, with a focus on managing capital inflows and domestic liquidity, along with exchange rate appreciation in line with exchange rate appreciation in the Asian region.  Bank Indonesia is strongly confident that the implementation of these monetary and macroprudential policy mix can secure macroeconomic stability and keep inflation within the targets".

At its most recent meeting, the Bank also maintained the BI rate unchanged at 6.75% in May this year.  Previously the Bank raised the rate by 25 basis points to the current 6.75% in February 2011.  Indonesia reported annual inflation of 5.98% in May, compared to 6.16% in April, and 6.65% in March, and just inside the inflation target of 5% +/-1% in 2011 (which changes to 4.5% +/-1% in 2012).


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