Indonesia Central Bank Cuts Key Rate By 25 Bps

Indonesia’s central bank lowered its key interest rate for the fourth straight meeting on Thursday.

The Board of Governors decided to reduce the 7-day reverse repo rate by 25 basis points to 5.00 percent. The decision came in line with expectations.

The decision is consistent with inflation that remains under control and returns on domestic financial investment assets remain attractive, and also as a pre-emptive measure to stimulate domestic economy growth amid slowing global economy, the bank said in a statement.

Gareth Leather, an economist at Capital Economics, said the bank is likely to ease further, but it is likely to tread cautiously over the coming months.

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