Jakarta: Coordinating Minister for Economic Affairs Darmin Nasution believes that the central bank's decision to cut its benchmark interest rate can help stimulate the country's investment growth.
"It can stimulate our investment growth," the top economic minister said here on Friday.
"I also hope that this policy can boost production and exports and improve our trade balance," he added.
Bank Indonesia (BI) decided to lower the BI 7-day Reverse Repo Rate by 25 bps to 5,50 percent during the Board of Governors meeting on August 21-22.
Furthermore, Deposit Facility (DF) and Lending Facility (LF) rates were lowered 25 bps to 4,75 percent and 6,25 percent respectively.
The policy is consistent with low inflation projected below the midpoint of the target corridor, attractive returns on domestic financial investment assets that support external stability, as well as a pre-emptive measure to safeguard economic growth momentum moving forward against the impact of global economic moderation.
The monetary operations strategy remains oriented towards ensuring adequate liquidity and increasing money market efficiency, thus strengthening the transmission of accommodative monetary policy.