Bank Indonesia Maintains Monetary Policy Stance Amid Global Uncertainty

Decision to Keep BI Rate at 4.75%

Bank Indonesia's Monetary Policy Committee decided to maintain the BI Rate at 4.75% during their meeting on December 16-17, 2025 ²

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Source 3

https://pusatdata.kontan.co.id/news/kurs-rupiah-melemah-tipis-saat-bi-menahan-bi-rate-hari-ini-1712

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Source 4

https://finansial.bisnis.com/read/20251217/11/1937585/breaking-bank-indonesia-tahan-bi-rate-475-demi-stabilitas-rupiah

. This decision comes despite The Fed's recent rate cut to 3.50%-3.75%, creating a wider interest rate differential between Indonesia and the US ⁶

Source 6

https://finansial.bisnis.com/read/20251217/90/1937588/kredit-perbankan-tumbuh-774-yoy-pada-november-2025-naik-tipis-dari-oktober

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Economic Rationale

The decision was based on several key factors:

1. Controlled inflation: Inflation remains within the target range of 2.5±1% for both 2025 and 2026 ⁴
   Source 4

   https://finansial.bisnis.com/read/20251217/11/1937585/breaking-bank-indonesia-tahan-bi-rate-475-demi-stabilitas-rupiah
2. Currency stability: Maintaining the rate helps support rupiah stability amid global uncertainty ³
   Source 3

   https://pusatdata.kontan.co.id/news/kurs-rupiah-melemah-tipis-saat-bi-menahan-bi-rate-hari-ini-1712
3. Credit growth improvement: Credit growth improved to 7.74% YoY in November 2025, up from 7.36% in October 2025 ⁵
   Source 5

   https://investasi.kontan.co.id/news/rupiah-melemah-tipis-usai-bi-tahan-suku-bunga-di-475
4. Economic growth prospects: BI maintained its growth projection for 2025 between 4.7%-5.5% and 4.9%-5.7% for 2026 ³
   Source 3

   https://pusatdata.kontan.co.id/news/kurs-rupiah-melemah-tipis-saat-bi-menahan-bi-rate-hari-ini-1712

Market Reaction

The decision was in line with market expectations, with 22 out of 34 economists surveyed by Bloomberg predicting that BI would maintain the rate ⁴

. Following the announcement, the rupiah depreciated slightly by 0.02% to Rp16,694 per USD ¹

Source 1

https://investasi.kontan.co.id/news/efek-suku-bunga-begini-proyeksi-rupiah-kamis-1812

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Future Outlook

BI indicated that they will continue to monitor economic developments closely, particularly the transmission of previous monetary easing measures ⁴

. Governor Perry Warjiyo stated that BI is in a position to assess the impact of previous rate cuts while maintaining currency stability ³

Source 3

https://pusatdata.kontan.co.id/news/kurs-rupiah-melemah-tipis-saat-bi-menahan-bi-rate-hari-ini-1712

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