FX Pressure Likely to Keep Bank Indonesia Rate Hikes on Table -- Market Talk

0304 GMT - Indonesia's mounting exchange-rate pressure is likely to persist, keeping the risk of further monetary tightening elevated, says UOB economist Enrico Tanuwidjaja in a note. The planned reserve requirement cuts should help banks maintain lending to businesses and households, he says. The economist expects Bank Indonesia to raise its policy rate by 25 bps in 4Q and again in 1Q of 2027, bringing it to 6.25%. Currency weakness and potential inflationary pressures from higher energy, food and fertilizer costs reinforce the need for BI to maintain stability, he adds. (yingxian.wong@wsj.com)

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October 21, 2026 23:04 ET (03:04 GMT)