Bank Indonesia cut its benchmark BI Rate by 25 basis points to 6.00% on Wednesday, marking the central bank's first rate reduction since February 2021.
The move came as the rupiah strengthened, inflation remained low and major central banks, most notably the United States Federal Reserve, prepared to begin easing. Bank Indonesia moved first: the Fed announced its own 50-basis-point reduction hours after the Indonesian decision.
FORWARD GUIDANCE
The central bank did not provide explicit forward guidance on the future pace of cuts, stating instead that subsequent decisions would be guided by developments in both domestic economic conditions and global financial markets.