Indonesia: BI to keep rates unchanged this week – UOB

Lee Sue Ann, Economist at UOB Group, gives her views on the upcoming Bank Indonesia (BI) meeting.

Key Quotes

“BI cuts its policy rate by 25bps in June to 4.25%. The move was aimed to support the slowing economy amidst negative ramifications from the COVID-19 pandemic. Given the low inflationary pressure, anchored FX stability, and the continuous need to boost economic growth, we expect another 25bps of rate cut in 3Q (likely in August), bringing the benchmark rate to 4.00%.”

“Risk to our forecast remains on the downside given the lingering uncertainty”.