BI Board of Governor's Meeting, June 2022

Jahen Rezki, Syahda Sabrina (), Nauli A. Desdiani (), Teuku Riefky, Amalia Cesarina, Meila Husna () and Faradina Alifia Maizar ()
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Syahda Sabrina: Institute for Economic and Social Research, Faculty of Economics and Business, Universitas Indonesia (LPEM FEB UI)
Nauli A. Desdiani: Institute for Economic and Social Research, Faculty of Economics and Business, Universitas Indonesia (LPEM FEB UI)
Meila Husna: Institute for Economic and Social Research, Faculty of Economics and Business, Universitas Indonesia (LPEM FEB UI)
Faradina Alifia Maizar: Institute for Economic and Social Research, Faculty of Economics and Business, Universitas Indonesia (LPEM FEB UI)

No 202206, LPEM FEBUI BI Board of Governor Meeting Brief from LPEM, Faculty of Economics and Business, University of Indonesia

Abstract: Despite rising global inflationary pressures in most countries due to soaring global food and energy prices and supply chain disruptions, domestic inflation remains under control, mainly driven by supply-side inflation underpinned by higher Producer Price Index (PPI) inflation that has been above Consumer Price Index (CPI) inflation since 2020. Domestically, we are still on a recovery path with robust economic performance and continuing series of trade balance surplus. Externally, the global economic volatility has not subdued, bringing bleak prospects for the global economy. Consequently, many central banks had already moved toward a more “hawkish†stance by raising their benchmark rates and reducing asset purchases to curb elevated domestic inflation, including the Fed, which recently raised its FFR by 75bps. This phenomenon triggers a flight to quality and depreciation in EM countries. Rupiah has been depreciated to around Rp14,800. Considering domestic and external circumstances, BI should remain behind the curve for the time being by keeping its policy rate at 3.50% while maintaining accommodative macroprudential measures to support economic growth.

Keywords: gdp; —; economic; —; economic; outlook; —; inflation; —; macroeconomics; —; interest; rate (search for similar items in EconPapers)
Date: 2022-06, Revised 2022-06
New Economics Papers: this item is included in nep-des and nep-sea
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https://lpem.org/repec/lpe/queouts/BBG202206.pdf First version, 2022 (application/pdf)

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Working Paper: BI Board of Governor's Meeting, July 2022 (2022)
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