BI 7 DRRR at 3.50%, Maintaining 2Q22 GDP. Other than low May CPI at 2.58% YoY (Vs. BI’s target of 3+/- 1%), NHKSI Research sees that BI 7DRRR was maintained at 3.50% to maintain the growth momentum of 2Q22 GDP, as capital outflow is still under control. Meanwhile, May forex reserves was at USD 135.6 billion, making room for BI intervention to rupiah which is closing in on IDR14,900/USD. Last week, JCI closed higher by 1.5% to 7.042. Consumer Non-Cyclicals, which are resilient to high inflation, lead sectoral strengthening by 5.7%. Then, followed by infrastructure that went up 3.3%, as basic infrastructure development for IKN Nusantara begins. The movement of the JCI is in line with the strengthening of the SUN market ahead of the end of the government’s Front Loading Strategy for the 1H22 period, and the Fed’s commitment to Hawkish stance in front of Congress.

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