Central banks stay on hold in Jakarta, Manila and Seoul

HONG KONG- The central banks of Indonesia, Korea and the Philippines decided today to keep interest rates on hold, despite current macro conditions differing significantly across these three economies.

After raising rates by 25bp last month, and by a cumulative 175bp since June, Bank Indonesia left rates on hold at 7.50% on evidence that inflation is declining and the  current account deficit is narrowing. In Korea, where inflation remains very low (0.9% y/y in November), the BOK kept its policy rate unchanged at 2.50% for a seventh month, judging “the economic recovery to be continuing in line with the trend of growth…”
Rates were kept on hold at 3.50% in the Philippines where inflation remains within the 3-5% target range, and as reconstruction gets underway after the devastating typhoon in November (ATI).