Bank Indonesia to support GDP growth by providing liquidity: governor

[JAKARTA] The governor of Indonesia's central bank pledged on Wednesday to provide as much liquidity as required to support economic growth, while vowing to prioritise interest rate policy to maintain rupiah stability in the short term.

Bank Indonesia (BI) Governor Perry Warjiyo added that with first quarter GDP growth at 2.97 per cent, below the bank's expectation, the full-year 2020 rate may be weaker than 2.3 per cent.

"Our stance remains loose," Mr Warjiyo told an online news conference. "But for the short term, interest rate policy's priority is the rupiah's stability, although we understand there is room to lower the (benchmark) rate."

For now, liquidity injection is more effective to help the economy weather the coronavirus pandemic, he added.

AFP