Bank Indonesia lifts interest rates to stem currency depreciation

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August 29, 2013

JAKARTA - Amid further downward currency pressures, Indonesia’s central bank has lifted interest rates by 50 basis points to 7%, the highest level since June 2009. The move comes exactly two weeks after BI kept rates on hold at its regular scheduled policy meeting on August 15. BI has now lifted rates by a cumulative 125 basis points since June in response to both a surge in inflation (8.6% y/y in July) from an administered fuel price increase on June 24, and currency pressures.