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Bank Indonesia keeps BI Rate at 5.75% as rupiah stability stays priority

UOB economist Enrico Tanuwidjaja said BI also highlighted keeping inflation within its 2.5% plus or minus 1% target range for 2026 to 2027.

Reported · Written up by our desk · Central Banks

Bank Indonesia kept the BI Rate at 5.75% in August, with a policy focus on rupiah stability and macro-financial resilience rather than near-term growth support, according to FXStreet citing UOB economist Enrico Tanuwidjaja.

Tanuwidjaja said BI emphasized external risk management, using liquidity measures and macroprudential tools, while the monetary stance remains tight as global uncertainty and capital flow volatility persist.

FXStreet also noted BI’s acting governor, Damayanti, framed rupiah stability as the key priority amid heightened global financial market volatility and referenced continued volatility tied to geopolitical tensions in the Middle East.

UOB scaled back its view on future hikes, expecting just two additional 25 basis point rate increases in 4Q26, which would lift the policy rate to a 6.25% terminal level by end-2026.

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