March 19, 2020 / 7:43 AM / 18 days ago

Indonesia cuts policy rate, as expected

JAKARTA, March 19 (Reuters) - Indonesia’s central bank cut its benchmark interest rate on Thursday, as expected, to soften the blow on Southeast Asia’s biggest economy from the coronavirus outbreak even as pressure piles up on a fragile rupiah.

Bank Indonesia (BI) trimmed the 7-day reverse repurchase rate by 25 basis points to 4.50%, its second cut in 2020 and the sixth in the current easing cycle.

The move was expected by a small majority of analysts in a Reuters poll and followed scores of rate cuts by central banks around the world to fight the impact of the health crisis.

BI also cut its overnight deposit facility and lending facility rates by the same amount to 3.75% and 5.25%, respectively.

The rupiah has fallen in recent weeks on capital outflow pressures. It fell more than 4% earlier on Thursday to trade at 15,850 a dollar, the lowest since 1998. (Reporting by Tabita Diela, Gayatri Suroyo and Fransiska Nangoy; Editing by Jacqueline Wong)

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