Indonesia Interest Rate 2005-2014 | Data | Chart | Calendar | Forecast

Bank Indonesia hiked its benchmark interest rate by 25 basis points to 7.75 percent on November 18th in a move to contain inflation after the government raised fuel prices more than 30 percent. Interest Rate in Indonesia averaged 7.71 Percent from 2005 until 2014, reaching an all time high of 12.75 Percent in December of 2005 and a record low of 5.75 Percent in February of 2012. Interest Rate in Indonesia is reported by the Bank Indonesia.

   
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Indonesia Interest Rate


Actual Previous Highest Lowest Dates Unit Frequency
7.75 7.50 12.75 5.75 2005 - 2014 percent Daily
In Indonesia the interest rate decisions are taken by The Central Bank of Republic of Indonesia. The official interest rate is the Discount rate. This is the rate at which central banks lend or discount eligible paper for deposit money banks, typically shown on an end-of-period basis. This page provides - Indonesia Interest Rate - actual values, historical data, forecast, chart, statistics, economic calendar and news. Content for - Indonesia Interest Rate - was last refreshed on Sunday, November 23, 2014.


Indonesia Raises Rates


Bank Indonesia decided to increase the benchmark interest rate by 25 bps to 7.75 percent at an extraordinary meeting, aiming to contain inflationary pressures after the government raised fuel prices more than 30 percent.

Statement by the Bank Indonesia:

The Bank Indonesia Board of Governors, convening on 18th November 2014, decided to strengthen its policy mix in response to the Government’s fuel subsidy reform policy.

First, raising the BI rate 25 bps to 7.75%, with an increase of 50 bps on the Lending Facility rate to 8.00% and the Deposit Facility rate to remain unchanged at 5.75%, effective from 19th November 2014. The increase of BI Rate is to anchor inflation expectation and to ensure that inflationary pressures remain under control and temporary, after the subsidized fuel price hike, and that inflation promptly returns towards its target corridor of 4±1% in 2015. The decision is also consistent with the progress in managing current account deficit towards a more sustainable level. The widening of interest rate corridor for monetary operation is intended to manage the liquidity and support financial market deepening.

Second, preparing macroprudential policy adjustments in order to enhance funding resources for banks while promoting financial market deepening, and extending loan to productive sectors. Such policy includes 1) extending the definition for deposits by including securities issued by bank in LDR calculation under LDR-linked RR policy, and 2) providing incentives to foster MSME credit allocation.

Third, strengthening payment system policy to support the smooth expansion of government social assistance program to public in order to tight over the impact of fuel price hikes through the use of electronic money and the implementation of Digital Financial Services (DFS).

Fourth, persisting with rupiah exchange rate stabilization policy in accordance with its fundamental value. Subsidized fuel reform policy is perceived to strengthen market confidence and improve the current account position, which is more conducive to future rupiah fluctuations.

Fifth, strengthening coordination measures with the Government at the central and provincial levels with a focus on efforts to minimise potential inflationary pressures, in particular stemming from rising transportation costs as well as maintaining food prices. Coordination will also be intensified in order to expand fiscal stimuli to productive sectors and further structural reform policy to catalyse economic growth and create employment opportunities.

Bank Indonesia is assured that strengthening its policy mix and tightening coordination with the Government will maintain macroeconomic and financial system stability as well as support sustainable economic growth.

Bank Indonesia welcomes the Government’s fiscal reform policy in order to reallocate the fuel subsidy budget to productive sectors. Despite higher prices in the near term, the policy mix of Bank Indonesia along with tight policy coordination with the Government is expected to control inflationary which is perceived only temporary. The policy is perceived to reduce oil imports and thereby reduce the current account deficit, particularly in terms of the persistently large oil and gas trade deficit. Government policy in terms of social assistance disbursements to the Poor will also offset the potential decline in public purchasing power, which is conducive to private consumption growth. Furthermore, reallocation of the subsidy budget to finance infrastructure development and various productive activities will boost the government’s fiscal capacity in terms of nurturing stronger and more sustainable economic growth. In general, Bank Indonesia projects economic growth in the range of 5.4-5.8% in 2015 and higher in the medium-long term, with maintained macroeconomic and financial system stability.

Bank Indonesia | Joana Taborda | joana.taborda@tradingeconomics.com
11/18/2014 11:59:19 AM


Recent Releases

Indonesia Leaves Monetary Policy Unchanged
Bank Indonesia left its benchmark interest rate on hold at 7.5 percent on November 13th, as inflation continues to ease and current account deficit narrowed in the third quarter of 2014. The lending facility rate and the deposit facility rate also remained unchanged at 7.5 percent and 5.75 percent respectively. Published on 2014-11-13

Indonesia Leaves Rates on Hold
At its October 7th meeting, Bank Indonesia’s left the benchmark interest rate steady at 7.5 percent, saying the current policy stance is consistent with the inflation target. Policymakers left rate unchanged for the eleventh straight meeting, as widely expected. Published on 2014-10-07


Calendar GMT Event Actual Previous Consensus Forecast (i)
2014-10-07 11:10 AM
Interest Rate Decision 
7.5% 7.5% 7.5% 7.5%
2014-11-13 08:30 AM
Interest Rate Decision 
7.5% 7.5% 7.5% 7.5%
2014-11-18 10:35 AM
Interest Rate Decision 
7.75% 7.5%
2014-12-11 09:00 AM
Interest Rate Decision 
7.75% 7.75%


Indonesia Money Last Previous Highest Lowest Unit
Interest Rate 7.75 7.50 12.75 5.75 percent [+]
Interbank Rate 5.80 5.85 89.80 1.17 percent [+]
Money Supply M0 395234.27 399272.40 452862.49 2983.00 IDR Billion [+]
Money Supply M1 949173.10 896008.00 949348.00 317.90 IDR Billion [+]
Money Supply M2 4009856.50 3887554.00 4009856.50 5156.00 IDR Billion [+]
Foreign Exchange Reserves 111972.61 111164.46 124637.75 27404.30 USD Million [+]
Loans to Private Sector 3200077.00 3137687.00 3200077.00 286724.00 IDR Billion [+]
Loan Growth 12.60 13.70 90.50 -59.90 percent [+]