Indonesia central bank makes third rate cut this year

Indonesia central bank makes third rate cut this year

Bank Indonesia on Thursday cuts interest rate for the third time this year. (Reuters photo)
Bank Indonesia on Thursday cuts interest rate for the third time this year. (Reuters photo)

JAKARTA: Indonesia's central bank on Thursday delivered its third interest rate cut this year, as expected, seeking to boost support for Southeast Asia's largest economy amid a coronavirus-induced downturn.

Bank Indonesia (BI) cut the benchmark 7-day reverse repurchase rate by 25 basis points to 4.25%, the lowest since 2018, as forecast by 18 of 30 economists in a Reuters poll. Eleven others had predicted no change, while one expected a bigger cut.

The central bank also cut the deposit and lending facility rates by the same amount, taking them to 3.50% and 5%, respectively.

In total, BI has trimmed rates by 75 basis points (bps) so far this year to stimulate economic activity, on top of four reductions amounting to 100 bps in 2019.


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