Indonesia’s central bank has raised interest rates for the second time in two weeks as it looks to stem the sharp decline in its currency, the rupiah.
It raised its key rate to 7.25%, the highest level in more than four years.
Indonesia’s currency has dipped nearly 18% against the US dollar since May this year as investors pull out of emerging markets, stoking concerns about the economic impact.
The central bank also cut its growth forecast for the current year.
On Thursday, it said that it now expects the economy to grow between 5.5% to 5.9% compared with its earlier projection of a growth between 5.8% to 6.2%.
That will be the lowest pace of growth since the global financial crisis in 2009.
via BBC
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Alfonso Esparza
trader focused on North America and emerging markets. He has been published by The MarketWatch, Reuters, the Wall Street Journal and The Globe and Mail, and he also appears regularly as a guest commentator on networks including Bloomberg and BNN. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.
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