BI Boss Ensures The Room For Lowering Interest Rates Is Still Open

Governor of Bank Indonesia (BI) Perry Warjiyo. (Photo: Doc. ANTARA)

JAKARTA - Bank Indonesia (BI) decided to maintain the benchmark interest rate (BI-Rate) at the level of 4.75 percent at the Board of Governors' Meeting (RDG) November 2025.

For the record, the BI-Rate has experienced a total decline of 150 basis points (bps), namely 25 bps in September 2024 and 125 bps throughout 2025 to reach 4.75 percent in October 2025, which is the lowest position since 2022.

BI Governor Perry Warjiyo said that in the future BI would continue to pay close attention to the opportunities for further BI-Rate decline.

According to him, this considers the 2025-2026 inflation projection which remains in the target range of 2.5 percent plus minus 1 percent, and the need to encourage stronger economic growth.

"Well, of course, this will consider the dynamics of the global economy and the future domestic economy which is often termed dependent data. At this time we view our focus is on stability, especially the stability of the rupiah exchange rate," he said at a press conference, Wednesday, November 19.

Perry emphasized that BI's short-term policy is currently directed to maintain the stability of the rupiah exchange rate, so that the Indonesian economy remains resilient in facing global uncertainty that continues.

He explained that global conditions had shown improvement after discussion of tariff policies, but uncertainty had increased again in the last two months due to the longest United States (US) government shutdown in history, U.S. inflation which has not subsided, as well as a smaller-than-expected reduction in Fed interest rates and is considered underdovish.

Perry added that various global uncertainties, both in terms of the economy and other factors, also exacerbated the situation.

"Our short term focus is the stability of the rupiah exchange rate while strengthening the effectiveness of the transmission of the easing of monetary policy and the easing of macroprudential policies that have been pursued so far," he said.

For information, the rupiah exchange rate as of November 18, 2025 was at Rp. 16,735 per US dollar, down 0.69 percent compared to the position at the end of October 2025.

Perry conveyed that this weakening was in line with the movement of regional currencies and trading partner countries.

He conveyed that to maintain stability in the midst of pressure from global uncertainty, BI carried out various intervention steps, both through Non-Deliverable Forward (NDF) transactions in foreign markets, spot transactions and domestic NDF (DNF) in the domestic market, as well as the purchase of SBN in the secondary market.

Perry said that the increase in the conversion of foreign exchanges to rupiah by exporters through strengthening the Natural Resources Export Result Foreign Exchange (DHE SDA) policy, as well as additional foreign supply from corporations, also supports rupiah stability.

Ke depan, ia menyampaikan BI berkomitmen menjaga stabilitas nilai tukar melalui intervensi terukur di pasar spot, NDF luar negeri, DNDF domestik, serta pembelian SBN demi mendukung pencapaian sasaran inflasi.

"Nilai tukar rupiah diperkirakan akan stabil didukung oleh imbal hasil yang menarik, inflasi yang rendah, dan tetap baiknya prospek pertumbuhan ekonomi Indonesia," katanya.

In the future, he said that BI is committed to maintaining exchange rate stability through measurable interventions in the spot market, foreign NDF, domestic DNDF, and purchasing SBN to support the achievement of inflation targets.

"The rupiah exchange rate is expected to be stable, supported by attractive returns, low inflation, and still good prospects for Indonesia's economic growth," he said.