Bank Indonesia (BI) has set the BI Seven Days Reverse Repo Rate (BI 7-DRRR) at 4% for the October 2020 period, or has held the benchmark interest rate for 4 consecutive months. BI also maintained its Deposit Facility and Lending Facility rates at the level of 3.25% and 4.75%, respectively. BI’s steps are still consistent, to encourage the recovery of the domestic economy affected by the COVID-19 outbreak. Meanwhile, the stability of the rupiah exchange rate and inflation remains low, a consideration for BI’s decision. For the record, Indonesia experienced deflation during the 3Q20 period, July amounting to –0.10%; August –0.05%; and September –0.05%. This figure indicates that people’s purchasing power was depressed during the period. Furthermore, the calendar year inflation rate is 0.89% YtD. Meanwhile, the annual inflation rate was recorded at 1.42% YoY.
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