SBI rate falls

JAKARTA: The weighted average interest rate on one-month Bank Indonesia SBI promissory notes fell to 17.37 percent at Wednesday's weekly auction compared to 17.50 percent last week.

Bank Indonesia accepted only 53.8 percent of the total bids, much lower than the normal percentage, raising speculation that the benchmark rate may continue to decline in the coming weeks.

The central bank auctioned Rp 17.13 trillion worth of one- month SBIs.

Bank Indonesia has been under pressure to lower interest rates so as to help the business sector obtain credit at favorable rates, and ease the burden on the state budget in financing interest payments on bank recapitalization bonds. --JP