Bank Indonesia's November 2025 Monetary Policy Decision

Consensus Predicts Status Quo on Interest Rates

Bank Indonesia is expected to maintain its benchmark interest rate at 4.75% during the November 2025 Rapat Dewan Gubernur (RDG) meeting ¹

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Source 2

https://finansial.bisnis.com/read/20251118/11/1929805/konsensus-ekonom-prediksi-bi-tahan-suku-bunga-475-di-rdg-november

. This prediction is supported by a Bloomberg survey showing 28 out of 33 economists forecasting no change in monetary policy ²

Source 2

https://finansial.bisnis.com/read/20251118/11/1929805/konsensus-ekonom-prediksi-bi-tahan-suku-bunga-475-di-rdg-november

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Economic Rationale Behind the Decision

The decision to maintain the current rate is driven by several factors:

1. Tight interest rate differential: The difference between Indonesian and US bond yields remains narrow, making Indonesian assets less attractive to foreign investors ¹
   Source 1

   https://finance.detik.com/berita-ekonomi-bisnis/d-8216460/ekonomi-indonesia-2025-antara-mimpi-dan-realita
   .
2. Capital outflows: Continued foreign portfolio outflows, particularly from government bonds, have been observed in early November 2025 ¹
   Source 1

   https://finance.detik.com/berita-ekonomi-bisnis/d-8216460/ekonomi-indonesia-2025-antara-mimpi-dan-realita
   .
3. Inflation expectations: Core inflation is projected to remain relatively stable and within the Bank Indonesia's target range of 2.5% ± 1% ¹
   Source 1

   https://finance.detik.com/berita-ekonomi-bisnis/d-8216460/ekonomi-indonesia-2025-antara-mimpi-dan-realita
   .

Future Monetary Policy Outlook

While the current prediction is for no rate change in November, further rate cuts are expected in the coming months. Citi Indonesia's Chief Economist projects BI Rate to decrease to 4.5% in December 2025 and 4.25% in March 2026 ¹

. These predictions are based on expectations of stable inflation and the need to support economic growth.

Economic Growth Projections

The economic outlook for Indonesia in 2025 remains mixed. The OECD projects economic growth at 4.9%, while the IMF's World Economic Outlook predicts a similar rate ³

. Bank Indonesia's own projection ranges between 4.6% to 5.4% ³

Source 3

https://finansial.bisnis.com/read/20251118/90/1929814/citi-indonesia-perkirakan-bi-tahan-suku-bunga-pada-rdg-november-2025

. The government's target of 5.2% growth appears challenging given current forecasts.

Market Implications

The decision to maintain interest rates is seen as a measure to maintain currency stability and attract foreign investment. Economists from major banks like BCA and Danamon support this view, citing the need to keep domestic yields attractive amidst global volatility ²

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