Indonesia’s central bank cut its main interest rate for the second consecutive month, wrong-footing most analysts as it seeks to support sluggish lending and consumption holding back growth in South-east Asia’s biggest economy, Bernama reported. Policymakers in Indonesia have been struggling to lift the economic growth rate, which has remained around 5% in each of the past four quarters. “The rate cut is clearly aimed at boosting the economy, which has struggled over the past few years,” said Gareth Leather, senior Asia economist at Capital Economics. Bank Indonesia cut the benchmark seven-day reverse repurchase rate by 25 basis points to 4.25%, following its first cut since October 2016 last month.
