JAKARTA – The Bank Indonesia Board of Governors’ Meeting (RDG) on July 24-25 2023 decided to maintain the BI 7-Day Reverse Repo Rate (BI7DRR) at 5.75%, the Deposit Facility interest rate at 5.00%, and the Lending Facility interest rate at 6.50%.
The decision to maintain the BI7DRR at 5.75% is consistent with the monetary policy stance to ensure that inflation remains under control within the target range of 3.0 ± 1% in the remainder of 2023 and 2.5 ± 1% in 2024. The policy focus is directed at strengthening the stabilization of the Rupiah value to control imported inflation and mitigate the spillover impact of global financial market uncertainty.
Macroprudential liquidity incentive policies were strengthened to encourage credit/financing with a focus on downstream, housing, tourism and inclusive and green financing. The acceleration of digitalization of the payment system continues to be encouraged to expand digital economic and financial inclusion.
The mix of Bank Indonesia’s monetary, macroprudential and payment system policies continues to be directed towards supporting sustainable economic growth.
In this regard, Bank Indonesia continues to strengthen the response of the policy mix to maintain stability and encourage growth as follows:
Strengthening the stabilization of the Rupiah exchange rate through: (i) intervention in the foreign exchange market with spot transactions, Domestic Non-Deliverable Forwards (DNDF), and buying/selling of Government Securities (SBN) on the secondary market, and (ii) twist operations through selling SBN on the secondary market for short tenors in order to increase the attractiveness of SBN yields for foreign portfolio investors;
Issuing provisions related to instruments for placing DHE SDA in the Indonesian financial system with 3 principles, namely: (i) in line with the provisions in PP 36/2023, (ii) utilization of DHE SDA for domestic needs, (iii) types of instruments allowed are still based on the principles (i) and (ii) referred to, and in accordance with economic and financial market developments.
Strengthening macroprudential policy stimulus to boost bank credit/financing growth through the implementation of the Macroprudential Liquidity Incentive Policy (KLM) for Conventional Commercial Banks (BUK) and Sharia Commercial Banks (BUS)/Sharia Business Units (UUS) which will take effect from 1 October 2023.
anangfadhilah
