Bank Indonesia kept its benchmark rate at the level of 7.5% yesterday with the deposit facility rate at the level of 5.5% and the lending facility was also set at the same level of 8%. It became the tenth month Bank Indonesia to hold interest rates after the last cut of 25 bps in February. Nowadays, the opportunity to cut interest rates again looks small because the pressure rupiah, and the uncertainty of external conditions.
BI reiterated that the central bank's current focus is to stabilize the rupiah by optimizing monetary operations. Rupiah weakened to Rp 13 748 per US dollar Tuesday. On the other hand, Bank Indonesia also back believes that the pressure is now more mainstream rupiah due to external pressures like-planned increase in the Fed Funds Rate.
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