Bank Indonesia Governor: Interest rate cuts aimed at stimulating demand for loans

After surprising the markets with a 25bps rate cut, the Bank Indonesia’s Governor continues to speak at the presser, with the further comments found below.

Policy rate decision is consistent with low inflation outlook.

Decision also to support GDP growth, cushion economy from global economic slowdown.

Looking forward, central bank to continue with "accommodative policy mix".

Consideration for rate cut also includes attractiveness of Indonesian assets for foreign investors.

We have to take preemptive move to anticipate global economic slowdown.

Interest rate cuts aimed at stimulating demand for loans.

To continue to explore macroprudential tools that can be loosened.

Inflation seen around 3% in 2020.

Aggregate demand is seen below aggregate supply in next 2 years.

The USD/IDR pair is seen resuming its recent declines, having failed to sustain the bounce around 14,240 region to now retest the three-day lows of 14,225.