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Indonesian central bank announces surprise rate cut

  • Indonesia's central bank announced a surprise cut to its policy rate by a quarter point to 5.75% on Wednesday, citing the need to move the economy and to ensure inflation remains under control.
  • Bank Indonesia cut its benchmark seven-day reverse repo rate by 25 basis points to 5.75%, marking the first rate cut since September 2024.
  • The decision was made following a two-day meeting of the Bank Indonesia Board of Governors, which also reduced deposit and loan facility rates by 25 basis points to 5.00 percent and 6.50 percent, respectively.
  • Bank Indonesia expects the country's economic growth in 2025 to be between 4.7 and 5.5 percent, slightly lower than the prior forecast range of 4.8 to 5.6 percent.
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