According to analysts at TD Securities, after surprisingly cutting policy rates by 25bp at the August meeting, they expect Bank Indonesia to hold its 7d reverse repo rate at 5.50% on Thursday, pausing after two consecutive rate cuts.
Key Quotes
“This is a change in call in the wake of the weekend drone attacks on oil refineries in Saudi Arabia. At least until the drone attacks the decision seemed to be clear cut, with inflation remaining low and BI becoming more progrowth orientated. However, it now appears a closer call given the subsequent weakness in the IDR. Over a third of analysts polled by Bloomberg expect no change at this meeting and we side with this view.”
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