BI Lowers Interest Rates To 6 Percent As Of September 2024

Governor of Bank Indonesia (BI) Perry Warjiyo. (Photo: Aris Nurjani/VOI)

JAKARTA - Bank Indonesia (BI) decided to lower the benchmark interest rate or BI Rate by 25 basis points to 6 percent at the September 2024 Board of Governors Meeting (RDG).

In addition, BI also decided to lower the deposit facility interest rate and lending facility rate to 25 basis points each to 5.25 percent and 6.75 percent.

BI Governor Perry Warjiyo said he decided to lower the benchmark interest rate by 25 basis points to 6 percent as a consistent step with a prostability monetary policy focus.

"The Meeting of the Board of Governors (RDG) of Bank Indonesia on September 17-18, 2024 decided to reduce the BI-Rate by 25 basis points to 6 percent," Perry said in a press conference, Wednesday, September 18.

According to Perry, this is consistent with the continued low inflation estimates in 2024-2025 which are controlled in the target set by the government, namely 2.5 percent plus minus 1 percent.

"Strengthening and stability of the rupiah exchange rate and the need for efforts to strengthen national economic growth," he said.

In the future, Bank Indonesia will continue to pay close attention to the space for lower policy interest rates in accordance with low inflation estimates and stable rupiah exchange rates and tends to strengthen and the economy needs to continue to be encouraged to be higher.

Perry said that macroprudential policies and payment systems were also continuously directed to support sustainable economic growth.

"Legal macroprudential policies continue to be pursued to encourage bank credit/financing to priority sectors for growth and job creation, including MSMEs and the green economy, while still paying attention to the precautionary principle," he said.

Perry explained that payment system policies are also directed to contribute to growth, especially in the trade sector and MSMEs, strengthen infrastructure reliability and the industrial structure of payment systems, and expand the acceptance of payment system digitization.