Perbanas Doubts BI Rate Will Rise Today, Here's Why

Jakarta, CNBC Indonesia - The Indonesian Banks Association (Perbanas) believes Bank Indonesia’s (BI) benchmark interest rate, the BI Rate, may not be raised at the Board of Governors Meeting (RDG) today, Thursday (18/6/2026).

Perbanas Chairman Hery Gunardi said this is because BI has already raised the benchmark rate several times recently. As is known, BI increased the rate by 50 bps at the May RDG, and raised it by another 25 bps at last week’s meeting, bringing it to the current 5.50%.

“It seems not, it’s already been raised. It’s jumped several times. It won’t be able to withstand it later. My feeling is, no,” said Hery when met at the Four Seasons Hotel on Thursday (18/6/2026).

Similarly, Perbanas Head of Research & Economic and Banking Studies, Aviliani, assessed that while the BI Rate still has room to rise, it may not be increased today. This is because BI just raised the benchmark rate last week.

“Yes, I see that interest rates will definitely rise, but whether BI wants to raise it, I’m not sure yet… Because it was just raised by 25 bps yesterday, would they raise it again? Even though it actually hasn’t had an effect, the cost of funds is already quite high,” Aviliani explained.

She then highlighted that the spread between the US central bank’s benchmark rate, the Fed Funds Rate (FFR), and the BI Rate is still too narrow. The Federal Reserve’s interest rate is currently in the range of 3.50% to 3.75%.

According to Aviliani, the issue with raising the BI Rate relates to stability versus growth. She noted that a BI Rate increase is followed by a significant rise in the yield on Bank Indonesia Rupiah Securities (SRBI).

“Between raising and not raising, we are still looking at the effect, because we see that government funds are going to be withdrawn. If government funds are withdrawn, even without BI raising rates, interest rates will automatically rise,” Aviliani explained.