Surprise Move: Indonesian Central Bank Cuts Interest Rate for the First Time in Three Years

On September 18, 2024, the Central Bank of Indonesia unexpectedly cut the key interest rate by 25 basis points to 6.00%, surprising most analysts. This was the first reduction since February 2021. Only three out of 33 economists surveyed by Reuters predicted this move, while most expected the rate to remain unchanged. Deposit and lending rates were also reduced to 5.25% and 6.75%, respectively. This decision was made to stimulate economic growth in Southeast Asia’s largest economy ahead of the anticipated easing of U.S. Federal Reserve policy.

Source: reuters.com