November 21, 2019 / 7:33 AM / 2 months ago

Indonesia holds key rate, cuts banks' reserve requirements

JAKARTA, Nov 21 (Reuters) - Indonesia’s central bank on Thursday held its benchmark interest rate unchanged after four consecutive rate cuts, but lowered the reserve requirement ratio for lenders to provide additional liquidity for the banking system and support growth.

Bank Indonesia (BI) kept unchanged the 7-day reverse repurchase rate at 5.00%, as predicted by 20 out of 24 economists in a Reuters poll.

BI had cut the rate in each of its four policy meetings prior to Thursday in an easing cycle that reduced the benchmark by 100 basis points.

This rolled back some of the 175 bps of rate hikes BI made last year, when it was defending the rupiah currency amid monetary tightening by the U.S. Federal Reserve.

BI’s two other main rates for overnight deposit and lending facilities were also kept unchanged at 4.25% and 5.75%, respectively. (Reporting by Maikel Jefriando and Nilufar Rizki; Writing by Gayatri Suroyo Editing by Jacqueline Wong)

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