JAKARTA, 20 May 2026 – Bank Indonesia surprised financial markets with a larger-than-expected 50 basis-point interest rate increase, lifting its benchmark seven-day reverse repurchase rate to 5.25% as policymakers moved to stabilise the rupiah and contain inflation risks.
The central bank also raised its overnight deposit facility rate by 50 basis points to 4.25% and its lending facility rate to 6.00%. The move marked Bank Indonesia’s first rate increase in two years and came after the rupiah weakened sharply against the US dollar, making it one of the weaker-performing currencies in emerging Asia this year.
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