Indonesia's central bank keeps interest rates steady

[JAKARTA] Indonesia's central bank kept its main policy rate at a record low on Tuesday as policymakers balanced the need to support the coronavirus-hit economy with concerns that further monetary easing could weigh on an already falling currency.

Bank Indonesia (BI) left the benchmark 7-day reverse repurchase rate at 3.50 per cent, where it has been since February. The move was forecast by all 27 analysts in a Reuters poll as the central bank has flagged the need to maintain rupiah stability.

BI also kept the overnight deposit facility and lending facility rates unchanged at 2.75 per cent and 4.25 per cent, respectively.

BI has cut interest rates by a total of 150 basis points, pumped more than US$50 billion liquidity into the financial system and relaxed lending rules since 2020 to help Southeast Asia's largest economy recover from the CoviD-19 pandemic.

REUTERS