Bank Indonesia may cut benchmark rate for fourth time
A small majority of economists expect Bank Indonesia (BI) to cut its benchmark rate for the fourth straight month at its meeting this week to support the economy.
18 out of 30 analysts in a poll expected BI to trim the 7-day reverse repurchase rate by 25 basis points to 5.00% on Thursday, following 3 successive rate cuts amounting to 75 basis points. The remaining analysts see the rate at 5.25%.
“Recent data continue to point to sluggish economy activity, supporting the case for another rate cut,” ANZ’s economist Krystal Tan said as she noted signs of weakness in consumption growth reflected by falling car and motorcycle sales.
Economic growth in 2019 is set to slow for the first time in four years after being hit by sluggish investment and the weakening global economy from the U.S.-China trade war.