Indonesia's Board of Governors keeps BI rate unchanged at 6¾%

By Toni Weeks

San Diego, July 12 - The Board of Governors of Bank Indonesia decided to keep the BI rate unchanged at 6¾% at its meeting on Tuesday, according to a news release.

The board recognized that global economic recovery is continuing and capital inflows are strong. The rupiah exchange rate is projected to remain stable with a tendency to appreciate at a moderate level.

The CPI inflation continues to decline, while the core inflation is still increasing. The CPI inflation in the second quarter of 2011 recorded at 5.54% year over year, or 0.12% month to month, mainly driven by the deflation in food prices and modest increase in core inflation.

The board also noted that the banking industry is in stable condition with steady improvement in the banking intermediation to support economic financing.

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