Economic Optimism Rebounds, BI Maintains Reference Interest Rate at 3.75%

Bank Indonesia's Board of Governors (RDG) meeting decided to maintain the benchmark interest rate, or the *BI 7-Day Reverse Repo Rate* (BI7DRR), at 3.75%. In addition, BI maintained the Deposit Facility interest rate at 3% and the Lending Facility interest rate at 4.5%.

This decision is consistent with projections of persistently low inflation and maintained external stability, and serves to support economic recovery.

The government is building optimism for national economic recovery with various policies, such as the safe and productive reopening of economic sectors, accelerated fiscal stimulus, bank credit disbursement, continued monetary stimulus, and the acceleration of economic and financial digitalization.

The domestic economy continued to improve until the end of 2020 and is expected to continue to grow in 2021. Indications of improvement can be seen in increased export and import activity, improved manufacturing PMI, and sustained consumer and sales expectations. The vaccination program that began in January 2021 and the implementation of health protocols are expected to support the domestic economic recovery process.