Indonesia c.bank holds rates, sees economic cycle past worst

January 23, 2020, 03.47 PM | Source: Reuters
Indonesia c.bank holds rates, sees economic cycle past worst

ILUSTRASI. Indonesia's central bank kept interest rates unchanged at its first policy meeting of the year. ANTARA FOTO/Indrianto Eko Suwarso/nz


Warjiyo expects easing policies implemented last year to continue to trickle down to the banking system and start having an impact on loan growth, which he expects to improve to a 10%-12% growth rate in 2020.

TARGET GROWTH

Bank Indonesia is confident economic expansion will improve to 5.3% in 2020, up from around an estimated 5.1% for 2019, still Warjiyo said all policy instruments would be geared toward supporting economic growth.

"Our view is for the central bank to have room for another 25 bp cut in 2020, provided that other regional central banks opt for easing as well," Bank Danamon economist Wisnu Wardana said in a note.

Meanwhile, Indonesia's economic growth and more stable global financial markets have supported capital inflows into the country so far this year, underpinning the rupiah.

Warjiyo said the rupiah's level remained in line with fundamentals and expected it to remain stable.

The rupiah has gained around 1.9% against the dollar so far this year, making it the top gainer among emerging Asian currencies.

Editor: Yudho Winarto

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