Free Trial

MNI BRIEF: BI Holds Benchmark Rate, Tightens RRR

MNI (Sydney)
SYDNEY (MNI)

Indonesia’s central bank has maintained its benchmark rate unchanged at 3.5% but has once again tightened the statutory reserve requirement ratio (RRR) for commercial banks at its meeting on Tuesday.

As expected, Bank Indonesia kept the 7-day reverse repo rate unchanged at 3.5%, the Deposit Facility interest rate at 2.75% and the Lending Facility rate at 4.25%, (See MNI STATE OF PLAY:Bank Indonesia Balances Timing On Tightening).

BI also announced it would “accelerate the normalisation of liquidity policy” through a gradual increase in statutory reserves. The RRR for commercial banks was set to rise to 6.5% by September but this has been increased to 6.0% starting in June and will move to 9.0% by September. The RRR move cuts the amount of cash banks park with BI to drain some banking system liquidity.

MNI Sydney Bureau | +61-405-322-399 | lachlan.colquhoun.ext@marketnews.com
MNI Sydney Bureau | +61-405-322-399 | lachlan.colquhoun.ext@marketnews.com

To read the full story

Close

Why MNI

MNI is the leading provider

of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.

Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.