BI Rate Increases by 25 Basis Points to 5.50%
In its weekly Board of Governors meeting on 9 June 2026, Bank Indonesia decided to raise the BI-Rate by 25 basis points to 5.50%, the Deposit Facility rate by 25 basis points to 4.50%, and the Lending Facility rate by 25 basis points to 6.25%.
Governor Perry Warjiyo stated that this increase is a follow-up measure to strengthen the stability of the Rupiah exchange rate against the impact of high global volatility caused by the war in the Middle East. It also serves as a pre-emptive step to ensure inflation for 2026 and 2027 remains within the government’s target range of 2.5±1%.
Perry emphasised that the policy is also intended to increase yields to enhance the attractiveness of foreign portfolio investment inflows into Indonesia. Following an evaluation of the monthly policy mix, the Rupiah had shown weaker development than expected, driven by ongoing global volatility, high domestic demand for foreign exchange, and foreign portfolio outflows.
To further stabilise the Rupiah and maintain external economic resilience, Bank Indonesia is implementing several monetary incentives:
An increase in the interest rate structure of Bank Indonesia Rupiah Securities (SRBI) for 6, 9, and 12-month tenors to boost the attractiveness of foreign portfolio investment.
The provision of incentives in the form of a 10% reduction in hedging swap rates for foreign investors to increase attractiveness and compensate for investor obligations.
The reopening of the repurchase agreement (repo) auction window for 3, 6, 9, and 12-month tenors for the banking sector to ensure adequate liquidity in the money and banking markets, targeting double-digit growth in Primary Money (M0).
Increased intensity of both Rupiah and foreign exchange monetary operations, including conducting SRBI auctions twice a week and intensifying interventions through spot transactions, DNDF in the domestic market, and NDF in overseas markets.
Perry also reaffirmed that Bank Indonesia continues to strengthen monetary policy coordination with the Government’s fiscal policy. This coordination, as previously communicated by the Minister of Finance and the Governor of Bank Indonesia, aims to ensure that fiscal and monetary measures are synchronised to support the stability of the Rupiah exchange rate and maintain macroeconomic stability amidst global uncertainty.