Bank Indonesia Decides Pangkas Interest Rate To Be 5.25 Percent

Governor of Bank Indonesia Perry Warjiyo (Photo: ANTARA)

JAKARTA - Bank Indonesia (BI) decided to lower the benchmark interest rate or BI-Rate by 25 bps to 5.25 percent.

In addition, BI also lowered the deposit facility interest rate and lending facility rate by 25 bps, bringing it to 4.50 percent and 6.00 percent, respectively.

BI Governor Perry Warjiyo said BI decided to maintain the benchmark interest rate at the level of 5.50 percent.

"The Meeting of the Board of Governors (RDG) of Bank Indonesia on July 15 and 16, 2025 decided to reduce the BI-Rate by 25 bps 5.25 percent," Perry said at a press conference, Wednesday, July 16.

According to Perry, this decision is consistent with the lower inflation forecasts for 2025 and 2026 in the target of 2.5 percent plus minus 1 percent.

In addition, he conveyed, and maintained stability of the Rupiah exchange rate in accordance with its fundamentals, and the need to continue to encourage economic growth.

In the future, Perry said, BI will continue to pay close attention to the space for lower interest rates to encourage economic growth while maintaining the stability of the rupiah exchange rate and achieving inflation targets in accordance with the dynamics that occur in the global and domestic economy.

Meanwhile, Perry said that accommodative macroprudential policies will continue to be optimized with various strategies to increase credit/financing, reduce interest rates, and flexibility in banking liquidity management in order to encourage sustainable economic growth.

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

Perry said, the direction of the mix of monetary, macroprudential, and payment systems is to maintain stability and encourage sustainable economic growth.