JAKARTA (Yosefardi) – The central bank, Bank Indonesia (BI), decided Friday last week to hold the BI 7-Day Reverse Repo Rate (BI 7-Day RR Rate) at 5.25%, with the Deposit Facility rate held at 4.50%, while lowering the Lending Facility 100 bps to 6.00%.
As announced on 15th April 2016, to improve monetary transmission effectiveness, the BI Board of Governors formally published the BI 7-Day RR Rate at the August meeting as the new policy rate to replace the existing BI Rate, effective Friday.
In addition, BI will also keep a more symmetrical and narrow interest rate corridor, the lower ceiling (DF) and upper ceiling (LF), at each 75 bps below and above the BI 7-Day RR Rate.
The policy is in line with efforts to maintain macroeconomic stability, by keeping domestic economic growth momentum amid a sluggish against a backdrop of the ongoing global economic slowdown.