Bank Indonesia Pangkas BI Rate To 5.50 Percent

JAKARTA - Bank Indonesia (BI) decided to lower the benchmark interest rate or BI-Rate by 25 bps to the level of 5.50 percent at the Board of Governors Meeting (RDG) on May 20, 2025 and May 21, 2025.

Bank Indonesia Governor Perry Warjiyo said BI also lowered the deposit facility interest rate and lending facility rate by 25 bps, bringing it to 4.75 percent and 6.25 percent, respectively.

"The Meeting of the Board of Governors (RDG) of Bank Indonesia on May 20 and May 21, 2025 decided to reduce the BI-Rate by 25 bps to 5.50 percent," Perry said at a press conference, Wednesday, May 21.

According to Perry, this decision is consistent with low inflation forecasts for 2025 and 2026 and remains under control in the targets set by the government of 2.5 percent plus minus 1 percent.

In addition, as well as maintaining the stability of the rupiah exchange rate in accordance with the fundamentals and to support sustainable economic growth.

In the future, Bank Indonesia will continue to direct monetary policy to maintain inflation in its goals and stability of the rupiah exchange rate in accordance with fundamentals while still observing space to help encourage economic growth that is in accordance with the dynamics of the global and domestic economy.

Meanwhile, Perry said that accommodative macroprudential policies continue to be optimized to support sustainable economic growth with various strategies to increase credit growth and encourage the flexibility of liquidity management by banks.

"The payment system policy is also directed to help support economic growth, especially the trade sector and MSMEs, through the expansion of the acceptance of digital payments, as well as strengthening infrastructure and consolidating the industrial structure of the payment system," he said.

In addition, Perry conveyed the direction of the mix of monetary, macroprudential, and payment systems to maintain stability in order to strengthen sustainable economic growth.