BI Decides To Hold BI-Rate At 6 Percent

BI Rate December 2024 Announcement (Photo: Aris Nurjani/VOI)

JAKARTA - Bank Indonesia (BI) decided to maintain the benchmark interest rate or BI-Rate by 6 percent. In addition, also maintain the deposit facility interest rate and lending facility interest rate by 5.25 percent and 6.75 percent, respectively.

BI Governor Perry Warjiyo said he decided to maintain the benchmark interest rate at the level of 6 percent as a step to be consistent with the focus of prostability monetary policy.

"The Meeting of the Board of Governors (RDG) of Bank Indonesia on 17 and 18 December 2024 decided to keep the BI-Rate at 6 percent," Perry said at a press conference, Wednesday, December 18.

According to Perry, this decision is consistent with the direction of monetary policy ensuring that inflation remains under control in the 2.5 percent plus-minus 1 percent target by 2024 and 2025, as well as to support sustainable economic growth.

Perry conveyed that the focus of monetary policy was directed to strengthen the stability of the rupiah exchange rate from the impact of the increasing uncertainty in the global economy due to the policy direction of the United States and the escalation of geopolitical tensions in various regions.

In the future, Perry said that Bank Indonesia will continue to monitor the movement of the rupiah exchange rate and the prospects for inflation, as well as the development of data and dynamics of developing economic conditions in observing the space for further lowering monetary policy interest rates.

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

"The loose macroprudential policy continues to be pursued to encourage bank financing credit to priority sectors for growth and job creation, including MSMEs and the green economy, through strengthening KLM incentives starting January 2025 while still paying attention to the precautionary principle," he said.

According to Perry, payment system policies are also directed to contribute to growth, especially in the trade sector and MSMEs by strengthening the reliability of infrastructure and the industrial structure of payment systems, as well as expanding the acceptance of payment system digitization.

Perry said to maintain stability and support sustainable economic growth amid increasing uncertainty in global financial markets.

"Expanding the acceleration of payment system digitization, the direction of the monetary policy mix, macroprudentials, and payment systems to maintain stability in order to support sustainable economic growth," he concluded.