International News 21/11
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Fed Cuts Rates, Cautious on Future Moves.
At the November 19-20, 2024 Board of Governors Meeting, Bank Indonesia has decided to maintain the benchmark interest rate, known as the BI Rate, at 6%. The central bank also maintained the Deposit Facility rate at 5.25% and the Lending Facility rate at 6.75%. This decision is in line with the monetary policy's objective of controlling inflation within the target range of 2.5 ± 1% in 2024 and 2025, while supporting sustainable economic growth. The objective is to stabilise the rupiah exchange rate in the context of geopolitical uncertainties and global economic uncertainty, particularly in light of developments in the United States. Going forward, Bank Indonesia will monitor the movement of the exchange rate, inflation prospects, data developments, and overall market conditions to determine the possibility of further policy rate cuts. In a consensus compiled by Bloomberg, economists had predicted that the BI Rate would remain at 6%.
Tok! Bank Indonesia Tahan BI Rate 6% pada November 2024
Fed Takes First Step Toward Easing Monetary Policy .
The Federal Reserve (The Fed), the central bank of the United States, has yet to determine the extent of the reduction in the benchmark interest rate. However, the initial decrease indicates that the Fed has confidence in the return of inflation to the 2% target. This information was conveyed by Kansas City Fed President Jeffrey Schmid during a speech to the Omaha Chamber of Commerce. He anticipates that inflation will meet the target due to improvements in the labor and product markets. While acknowledging progress towards the target, Schmid emphasized the need to observe the extent of the interest rate reduction and the eventual rate at which it will stabilize. He did not provide a view on whether he would support a rate cut at the Fed's next meeting. This decision reflects the Federal Reserve's assessment of the current economic conditions and outlook for inflation.
The Fed Dikabarkan 'Galau' Lanjutkan Pangkas Suku Bunga
BI Governor Warns of Global Economic Risks Amid Rising US Tensions.
Bank Indonesia (BI) Governor Perry Warjiyo has voiced concerns over mounting global economic risks, citing mounting geopolitical tensions and trade fragmentation. He anticipates that political developments in the United States, such as expansionary fiscal policies and inward-looking economic strategies, including high trade tariffs and strict immigration policies, will impact economic growth in many countries, including China and the European Union. Furthermore, Perry anticipates a gradual reduction in inflation in the United States, which will likely result in minimal adjustments to the US Federal Funds Rate (FFR). Furthermore, the US government's increased need for fiscal deficit financing has caused US Treasury yields to rise in both the short-term and long-term. The aforementioned changes in the United States have resulted in a strengthening of the US dollar and a shift in global investor preferences back towards the United States.