Indonesia: BI remains on hold in July – UOB

• Jul 25, 2022

Economist at UOB Group Enrico Tanuwidjaja comments on the latest interest rate decision by the Bank Indonesia (BI).

Key Takeaways

“Bank Indonesia (BI) kept its benchmark rate (7-Day Reverse Repo) unchanged at 3.50% at its Jul MPC meeting.”

“BI continue to opt for liquidity normalisation of Rupiah Reserve Requirement (RR) hike to reach 9.0% starting on 1 September 2022 as monetary normalization mechanism.”

“We keep our view for BI to start hiking in 3Q22 (Aug and Sep), with two 25bps hikes in 3Q 2022 to 4.00%, followed by another two 25bps hikes in 4Q, taking its benchmark rate to 4.5% by the end of 2022.”

Source: https://www.fxstreet.com/news/indonesia-bi-remains-on-hold-in-july-uob-202207250518