Jakarta: Bank Indonesia (BI) today announced its decision to lower the BI 7-day Reverse Repo Rate by 25 basis points (bps) to 4,25 percent.
In addition, Deposit Facility (DF) rates were lowered 25 bps to 3,50 percent and Lending Facility (LF) rates were lowered 25 bps to 5,00%.
"The decision is consistent with efforts to maintain economic stability and nurture economic recovery momentum in the covid-19 era," BI Governor Perry Warjiyo said during a virtual press conference here on Thursday, June 18, 2020.
Moving forward, the central bank still perceives space to lower interest rates in line with mild inflationary pressures, maintained external stability and the need to stimulate economic growth.
Meanwhile, policy to stabilise rupiah exchange rates and quantitative easing will be continued.
Furthermore, the central bank has decided to implement reserve requirement remuneration for banks meeting daily and average rupiah reserve requirements of 1.5 percent per year based on 3 percent of deposits, effective August 2020.
BI will also continue to strengthen its policy mix and synergise to implement the follow-up policies required through coordination with the Government and Financial System Stability Committee in order to maintain macroeconomic and financial system stability, while supporting the national economic recovery.
To that end, BI is committed to funding the State Revenue and Expenditure Budget (APBN) through SBN purchases in the primary market and providing liquidity in the banking industry to bolster the loan (financing) restructuring program and support the national economic recovery.