JP\/13\/Blum<\/p>\n
SBI rate down to 10.68%<\/p>\n
The Jakarta Post
\nJakarta<\/p>\n
Bank Indonesia on Wednesday cut its benchmark interest rate to
\n10.68 percent, a day after newly-appointed central bank Governor
\nBurhanuddin Abdullah pledged to maintain the current declining
\ntrend in the rate.<\/p>\n
The interest rate on one-month Bank Indonesia SBI promissory
\nnotes was previously at 10.80 percent.<\/p>\n
The central bank has been guiding down its benchmark rate over
\nthe past year amid a benign inflation environment and an
\nappreciation in the exchange rate of the rupiah against the U.S.
\ndollar.<\/p>\n
Early last year, the rate was still hovering at more than 17
\npercent. The lower rate would ease the burden of the government
\nin servicing its domestic debts.<\/p>\n
But Burhanuddin expected the rate cut could help trigger banks
\nto boost lending to the corporate sector to accelerate the
\ncountry's economic growth.<\/p>\n
\"I can still see room for further cuts, hopefully it can reach
\na level below 10 percent,\" Burhanuddin told reporters.<\/p>\n
Throughout 2002, the central bank recorded new loans expanded
\nby banks amounting to Rp 62.5 trillion (US$7.3 billion), a slight
\nincrease compared with Rp 56 trillion handed out the year before,
\nwhen the SBI rate was were still hovering at around 18 percent.<\/p>\n
Despite the cut in the SBI rate, the rupiah closed at a fresh
\n21-month high on Wednesday as foreign investors apparently
\ncontinued to park funds in local capital markets amid rising
\noptimism over the nation's economic fundamentals, dealers said.<\/p>\n
The rupiah closed at Rp 8,310 per U.S. dollar, higher than
\n8,360 Tuesday.<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/jp13blum-1447899208",
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"sponsor": "Okusi Associates",
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