Another Indonesian Central Bank Rate Hike But Perhaps the Last One

January 19, 2023

From a pandemic low of 3.5% (February 2021 to August 2022), Bank Indonesia’s 7-day reverse repo rate had been raised four times by a half percentage point plus once by 25 bps during the balance of last year. A sixth 25-bp hike announced today lifts such to 5.75%, its highest level in three and a half years. CPI inflation has fallen from September’s 7-year high of 5.95% to 5.51%. Believing that the cumulative tightening constitutes enough restraint to return inflation to its 2-4% target range, officials indicated that today’s move could represent the last one of this cycle.

Copyright 2023, Larry Greenberg. All rights reserved. No secondary distribution without express permission.

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This entry was posted on Thursday, January 19th, 2023 at 8:51 am and is filed under Central Bank Watch. You can follow any responses to this entry through the RSS 2.0 feed. Both comments and pings are currently closed.

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