Bank Indonesia unlikely to cut amid increased market uncertainty – TDS

In the view of the analysts at TD Securities (TDS), the Indonesian central bank, Bank Indonesia (BI), is likely to stand pat on its monetary policy this Thursday, despite low inflation and increased global uncertainty.

Key Quotes:

“We expect no change from Bank Indonesia at its meeting on Thursday August 22. BI lowered its 7-day Reverse Repo Rate by 25bp to 5.75% in July.

At the time BI cited low inflation expectations and need to build economic growth momentum amid easing global market uncertainty.

Since then global market uncertainty has intensified and volatility has risen.

Consequently, we think BI will pause, before easing policy again, with another 50bps of easing likely by end 2019.”