Jakarta: Bank Indonesia (BI) has decided to hold its 7-Day Reverse Repo Rate at 6.00 percent, while also maintaining the Deposit Facility (DF) and Lending Facility (LF) rates at 5.25 percent and 6.75 percent respectively.
Seeking to ensure adequate liquidity in the banking industry in order to finance economic activity, the central bank has decided to lower the rupiah reserve requirement for conventional and Islamic banks by 50bps to 6.0 percent and 4.5 percent respectively, with the average reserve requirements remaining at 3.0 percent, effective from July 1.
"Bank Indonesia constantly monitors global financial market dynamics and the external stability of the national economy when considering reductions to the policy rate in line with low inflation and the current need to stimulate domestic economic growth," BI Governor Perry Warjiyo told a press conference on Thursday.
According to him, BI will continue to orient the monetary operations strategy towards ensuring adequate liquidity is available in the money market.
Furthermore, BI will maintain an accommodative macroprudential policy stance to catalyse bank lending and expand economic financing.
"In addition, Bank Indonesia will bolster payment system policy and financial market deepening efforts to support economic growth, while strengthening coordination with the Government and other relevant authorities to sustain economic stability, stimulate domestic demand, increase exports and tourism as well as attract foreign capital flows," the BI governor remarked.