Bank Mandiri: Interest Rate Hike Safeguards Rupiah Stability

Bank Mandiri welcomes the decision of Bank Indonesia’s Weekly Board of Governors Meeting on 9 June 2026, which raised the BI-Rate by 25 basis points to 5.50%. Bank Mandiri assesses that the move reflects the central bank’s firmness in maintaining rupiah exchange rate stability amidst external dynamic pressures, including the escalation in the Middle East and foreign portfolio investment outflows. “Maintained stability is an important foundation for the sustainability of economic activity, the confidence of business actors and the public, as well as the creation of healthy growth space in the long term,” said Bank Mandiri Director of Finance & Strategy Novita Widya Anggraini in a statement received on Wednesday (10/6). Irrespective of the direction of interest rate movements, she continued, banking still has an important role in maintaining the smooth running of economic activity through its intermediation function and reliable transaction services. “In line with this, Bank Mandiri will continue to strengthen its value chain ecosystem strategy and enhance digital capabilities to support the needs of the wider community and business activities in a sustainable manner,” Novita said. Meanwhile, any adjustment to deposit or lending rates, she said, will be carried out by considering market conditions, liquidity dynamics, and prudent risk management. “Going forward, Bank Mandiri is optimistic it can continue to support the financing needs of business actors, MSMEs, and the public, in line with its role as an agent of development in encouraging the creation of added value in various economic sectors,” she concluded. Previously, the Bank Indonesia Board of Governors Meeting decided to again raise the BI-Rate by 25 bps to 5.50%, the deposit facility rate by 25 bps to 4.50%, and the lending facility rate by 25 bps to 6.25%. This increase is a further step to strengthen the stabilisation of the rupiah exchange rate from the impact of high global turmoil due to the war in the Middle East. “As well as a pre-emptive measure to keep inflation in 2026 and 2027 within the government’s target range of 2.5±1%,” said BI Governor Perry Warjiyo in an official statement on Tuesday (9/6). This policy, he continued, is also aimed at increasing yields to attract foreign portfolio investment inflows into Indonesia. In the evaluation since the Board of Governors Meeting on 18-19 May 2026, the rupiah exchange rate showed a weaker development than expected. Besides being caused by continuing global turmoil and high domestic foreign exchange demand, the weakening was also driven by foreign portfolio investment outflows from Indonesia. In connection with this, Bank Indonesia views it necessary to take further steps to strengthen rupiah exchange rate stabilisation by again increasing yields and a number of other incentives in monetary operations to encourage the inflow of foreign investment. “The intended stabilisation of the rupiah exchange rate is also pursued so that the external resilience of the Indonesian economy is maintained and the inflation targets for 2026 and 2027 are still achieved,” Perry said.