Rupiah Slump May Keep Indonesia Rate Cuts at Bay Until 2025
- Most economists expect BI to hold rate at 6%, delay easing
- ‘Panic hike’ could worsen outflows, weaken rupiah anew: Nomura
Pedestrians in front of the Bank Indonesia headquarters in Jakarta, Indonesia.
Photographer: Rosa Panggabean/BloombergThis article is for subscribers only.
Indonesia’s central bank will likely postpone monetary easing to later this year, if not early 2025, as it waits out uncertainty around the Federal Reserve’s rate path and the continued fighting in the Middle East.
Twenty of 21 economists polled by Bloomberg expect Bank Indonesia to delay rate cuts, with most expecting an easing in the fourth quarter and a few as late as the January-March period. In other words, the central bank is more likely to stand pat on Wednesday, according to 30 of 41 analysts in a separate survey, with the remainder penciling in the possibility of a quarter-point hike in the BI-Rate to 6.25%.