Arab Today, arab today indonesia cbank holds rate lowers interbank band
Last Updated : GMT 04:33:33
Arab Today, arab today
Arab Today, arab today

Indonesia cbank holds rate, lowers interbank band

Arab Today, arab today

Arab Today, arab today Indonesia cbank holds rate, lowers interbank band

Jakarta - Spa

Indonesia\'s central bank left its main policy rate unchanged on Thursday for a seventh straight month, choosing to ignore a temporary upward blip in inflation in favour of caution as the global economic outlook deteriorates, according to Reuters. At the same time, Bank Indonesia lowered the floor of the trading band for interbank overnight rates by half a percentage point to give its banking system the flexibility to deal with fickle cash conditions and fluctuating money market rates. Core inflation in August rose above the 5 percent mark that one central bank official suggested is the threshold for a policy shift. Yet Thursday\'s decision to hold the policy rate at 6.75 percent confirmed that the central bank views the upward blip in food, clothing and gold prices during the Ramadan festivities as temporary. It also put Indonesia in the growing camp of central banks shifting focus away from inflation to growth as they brace for a protracted period of weak global demand. South Korea left rates on hold for a third month at a review on Thursday, Australia\'s did the same earlier this week. Inflationary pressures in Southeast Asia\'s largest economy are subdued and growth is robust in the largely domestic-driven economy. Analysts therefore suspect the fear of financial contagion and market volatility is behind Bank Indonesia\'s decision to err on the side of caution. That seemed to be the reason Bank Indonesia widened the floor of its interbank overnight rate to 150 basis points below the policy rate, from 100 basis points below previously. \"This decision is taken by considering the need to guard economic stability amid rising uncertainties in the global financial system triggered by the U.S. and Europe debt problems,\" Bank Indonesia said in a statement. Indonesia\'s stock market , Asia\'s best performing this year, has been spared a lot of the volatility spawned by Europe\'s debt crisis and faltering global growth. But, having used a rising rupiah to keep price pressures in check, the central bank is worried about market turbulence and potential capital outflows from Southeast Asia\'s largest economy. JUST AS EXPECTED All 12 analysts polled by Reuters had forecast a rate hold. BI made a surprise move to raise the policy rate by 25 basis points in February to address inflation worries. Core inflation in August accelerated to 5.15 percent, though broader inflation remained manageable at 4.79 percent as Muslims spent more on foods, clothes and transport to celebrate Eid. Analysts also expect Bank Indonesia to leave the rate unchanged for the rest of 2011 as part of efforts to maintain solid growth at a time of increasing worry about the global economy, given woes in Europe and the United States. \"The focus has switched back to growth instead of inflation,\" said Eugene Leow, an economist with DBS in Singapore. \"With the external economy more uncertain, the central bank has to be seen to help to boost the economy and is likely to keep rates low. It looks unlikely that they will be willing to hike rates this year. \"Inflation has been surprisingly tame so looks like this sweet spot will continue for a while more,\" Leow said. BI Governor Darmin Nasution told Reuters in an Aug. 25 interview that the bank would prefer to continue using monetary policy tools rather than rate rises to counter increasing prices or to slow loan growth. The central bank has allowed the rupiah rise to a seven-year high and used other macroprudential measures to tame inflation after the surprise 25 basis point rate increase in February aimed at calming the market. The rupiah has risen 5 percent against the U.S. dollar so far this year, one among the top gainers in Asia along with the Korean won and Singapore dollar . Indonesia\'s benchmark stocks index is up 13.7 percent so far this year on a dollar basis, while the MSCI Asia Pacific ex-Japan index is down 10.5 percent. BI has tried to keep the policy rate low to help spur bank lending, which grew by 24 percent in August from a year ago, and economic expansion seen at 6.6 percent this year.  

Name *

E-mail *

Comment Title*

Comment *

: Characters Left

Mandatory *

Terms of use

Publishing Terms: Not to offend the author, or to persons or sanctities or attacking religions or divine self. And stay away from sectarian and racial incitement and insults.

I agree with the Terms of Use

Security Code*

Arab Today, arab today indonesia cbank holds rate lowers interbank band Arab Today, arab today indonesia cbank holds rate lowers interbank band

 



Arab Today, arab today
Arab Today, arab today Nasima Gamei revives Algerian heritage in jewelries

GMT 22:42 2017 Thursday ,23 February

Nasima Gamei revives Algerian heritage in jewelries
Arab Today, arab today Saudis await visitors but will they come?

GMT 11:54 2017 Thursday ,23 February

Saudis await visitors but will they come?
Arab Today, arab today Sarah Belamesh designs antiques of "ceramic"

GMT 19:45 2017 Monday ,20 February

Sarah Belamesh designs antiques of "ceramic"
Arab Today, arab today Blind sheikh buried in Egypt

GMT 06:32 2017 Thursday ,23 February

Blind sheikh buried in Egypt
Arab Today, arab today Media host Mona Iraqi stresses her show's success

GMT 15:32 2017 Wednesday ,22 February

Media host Mona Iraqi stresses her show's success
View News in Arabic - Business: مصارف
Arab Today, arab today
Arab Today, arab today
Arab Today, arab today To hold social dialogue over secondary school

GMT 07:43 2017 Wednesday ,22 February

To hold social dialogue over secondary school
Arab Today, arab today UK appoints 1st Scotland Yard chief in 188 years

GMT 05:14 2017 Thursday ,23 February

UK appoints 1st Scotland Yard chief in 188 years
Arab Today, arab today Ex-yoga missionary unleashes rage

GMT 12:16 2017 Thursday ,23 February

Ex-yoga missionary unleashes rage
Arab Today, arab today Pluto's unruly moons

GMT 06:31 2015 Thursday ,04 June

Pluto's unruly moons
Arab Today, arab today Tesla back into red but revenue grows

GMT 07:27 2017 Thursday ,23 February

Tesla back into red but revenue grows
Arab Today, arab today Nissan enhances sales in most markets

GMT 14:08 2017 Monday ,20 February

Nissan enhances sales in most markets
Arab Today, arab today Salma Rashid happy for 'A Whisper of Love'

GMT 05:19 2017 Tuesday ,21 February

Salma Rashid happy for 'A Whisper of Love'
Arab Today, arab today Milan laughs while Rome cries

GMT 10:28 2017 Wednesday ,22 February

Milan laughs while Rome cries

GMT 06:41 2017 Monday ,20 February

Janat pleased for issuing 'Good Morning'

GMT 12:35 2017 Tuesday ,21 February

63-Year-Old Woman Delivers Baby

GMT 20:02 2017 Tuesday ,21 February

Nohan Seyam designs beautiful accessories

GMT 15:53 2017 Tuesday ,21 February

Small ponds have outsized impact

GMT 23:29 2017 Thursday ,16 February

Home built on sand castles-style costs $8m

GMT 07:51 2017 Wednesday ,22 February

Mom's immune system accepts babies

GMT 17:46 2017 Saturday ,18 February

Tourist guide reveals methods of tourist attractions

GMT 13:12 2015 Saturday ,09 May

Sheikh Sultan opens Sharjah Centre

GMT 12:22 2017 Monday ,20 February

Kanye West puts hijab-wearing model
Arab Today, arab today
Arab Today, arab today
 
 Arab Today Facebook,arab today facebook  Arab Today Twitter,arab today twitter Arab Today Rss,arab today rss  Arab Today Youtube,arab today youtube  Arab Today Youtube,arab today youtube
arabstoday arabstoday arabstoday arabstoday
arabstoday arabstoday arabstoday
arabstoday
بناية النخيل - رأس النبع _ خلف السفارة الفرنسية _بيروت - لبنان
arabstoday, Arabstoday, Arabstoday