SBI rate unchanged at 13.10%

SBI rate unchanged at 13.10%

JAKARTA: The weighted average interest rate on one-month SBI promissory notes, as expected, was unchanged yet again, at 13.10 percent, in a weekly auction, the central bank said Wednesday.

Bank Indonesia also said it accepted Rp 15 trillion (US$1.6 billion) of bids at the auction, or 79.7 percent of total bids.

The weighted average rate for three-month SBI notes was unchanged as well, at 13.12 percent. The central bank accepted Rp 8.98 trillion of bids for the tenor, or 99.99 percent of total bids for the three-month maturity.

Bank Indonesia had been cutting rates this year to boost economic growth. The benchmark one-month SBI was around 18 percent in the third quarter of last year. But the central bank reversed that policy bias when the rupiah came under renewed downward pressure after the Oct. 12 terrorist attack in Bali, which killed nearly 200, mostly western, tourists.

But raising interest rates further isn't an option for Bank Indonesia because such a move will raise the costs of bailing out banks, many of which went under during the Asian economic crisis in 1997-98, analysts say. -- Dow Jones