Indonesia central bank cuts benchmark rate by 25 bps to 5.25%
Bank Indonesia (BI) cut the benchmark 7-day reverse repurchase rate by 25 basis points to 5.25 per cent, as expected by a slim majority of economists polled by Reuters.
It also trimmed the overnight deposit and lending facility rates by the same amount to 4.50 per cent and 6.00 per cent, respectively.
Governor Perry Warjiyo said at a briefing that the rate cut was consistent with the need to support Indonesia's economic growth.
Sluggish household spending had already weakened Indonesia's growth in the first quarter, while the outlook for subsequent quarters has been clouded by the impact of US tariffs on global trade.
On Tuesday, President Donald Trump said the US would impose a 19 per cent tariff on goods from Indonesia under a new agreement with the South-east Asian country.
BI's GDP growth forecast for 2025 is within a range of 4.6 per cent to 5.4 per cent. The government's official 2025 target is 5.2 per cent and President Prabowo Subianto has pledged to lift growth to 8 per cent by the end of his term in 2029.
Before Wednesday, BI had cut rates three times since September, taking pauses in between the cuts to try to head off volatility in the rupiah triggered by Trump's trade policies and geopolitical tensions. REUTERS
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
CNA
5 hours ago
- CNA
KKR in talks to buy ST Telemedia Global Data Centres, Bloomberg News reports
KKR is in talks to buy ST Telemedia Global Data Centres in a deal that could value the Asian digital infrastructure provider at more than $5 billion, Bloomberg News reported on Saturday, citing people familiar with the matter. Reuters could not immediately verify the report.
Straits Times
8 hours ago
- Straits Times
Indian firm says it shipped non-military explosives to Russia
NEW DELHI - An Indian firm that shipped $1.4 million worth of an explosive compound with military uses to Russia in December said on Saturday it complies with Indian rules and the substance it had shipped was for civilian industrial purposes. Reuters reported on July 24 that Ideal Detonators Private Limited shipped the compound, known as HMX or octogen, to two Russian explosives manufacturers despite U.S. threats to impose sanctions on any entity supporting Russia's Ukraine war effort. One of the Russian companies listed in Indian customs data as receiving the compound is the explosives manufacturer Promsintez. An official at Ukraine's SBU security service has said the Russian company has ties to the military and that Ukraine launched a drone attack in April against a Promsintez-owned factory. Promsintez did not respond to a request for comment. Ideal Detonators said in an emailed response to Reuters that the material it shipped was not military grade. "The shipment ... is for industrial activity and it's a civil explosive," the company said. The U.S. government has identified HMX as "critical for Russia's war effort" and has warned financial institutions against facilitating any sales of the substance to Moscow. The U.S. Treasury Department has the authority to sanction those who sell HMX and similar substances to Russia, sanctions lawyers have said. Top stories Swipe. Select. Stay informed. Singapore Woman taken to hospital after car falls into sinkhole on Tanjong Katong Road Singapore Students hide vapes in underwear, toilet roll holders: S'pore schools grapple with vaping scourge Singapore 'I've tried everything': Mum helpless as son's Kpod addiction spirals out of control Singapore NDP 2025: How Benjamin Kheng is whisked from Marina Bay to Padang in 10 minutes by boat, buggy Singapore Almost half of planned 30,000 HDB flats in Tengah to be completed by end-2025: Chee Hong Tat Singapore From libraries to living rooms: How reading habits take root in underserved S'pore children Asia Thai-Cambodia clashes spread along frontier as death toll rises Asia Thousands rally in downtown Kuala Lumpur for resignation of PM Anwar HMX is widely used in missile and torpedo warheads, rocket motors, exploding projectiles and plastic-bonded explosives for advanced military systems, according to the Pentagon's Defense Technical Information Center and related defense research programs. The compound also has some limited civilian applications in mining and other industrial activities. REUTERS
CNA
12 hours ago
- CNA
South Korea seeks mutually agreeable US trade package as Aug 1 tariff deadline looms
SEOUL: South Korea will prepare a trade package that is mutually agreeable with the United States ahead of minister-level meetings planned next week and a US tariff-pause deadline of Aug 1, the presidential office said on Saturday (Jul 26). The package will include shipbuilding cooperation, a sector of high interest to US Commerce Secretary Howard Lutnick, who discussed the matter with South Korea's Industry Minister Kim Jung-kwan on Friday, it said in a statement. Friday's meeting was a follow-up to a meeting on Thursday, where Lutnick and Kim reaffirmed their commitment to reach a trade deal by Aug 1, after a joint meeting of finance ministers and top trade envoys that had been scheduled for Friday was postponed. South Korea, facing 25 per cent tariffs, is rushing to reach a trade deal with Washington, with National Security Adviser Wi Sung-lac visiting the US recently for high-level talks and Minister for Trade Yeo Han-koo also in the US for negotiations, as pressure grows on officials to clinch a deal that is no worse than Japan's that cut tariffs to 15 per cent. South Korea's trade negotiations with the US have included non-tariff barriers in the agricultural and digital service sectors, but foreign exchange has not been part of trade talks beyond usual consultations, according to South Korean officials. US President Donald Trump arrived in Scotland on Friday for bilateral talks with European Commission President Ursula von der Leyen on Sunday, which could yield a trade deal with the European Union, after making a deal earlier this week with Japan and the Philippines. Next week, US officials will hold a new round of trade talks with China in Sweden for an extension to a separate deadline of Aug 12 set between the two countries. South Korea's Finance Minister Koo Yun-cheol and Foreign Minister Cho Hyun will also hold meetings with US Treasury Secretary Scott Bessent and State Secretary Marco Rubio, respectively, next week.
