According to a report by Jin Ten Data, economists from HSBC Global Research predict that after the Bank of Indonesia lowers the interest rate by 25 basis points on Wednesday, it may further cut rates by 100 basis points in the coming quarters.
A rate cut of 25 basis points is expected in the third quarter of 2025, a cut of 50 basis points in the fourth quarter, and a cut of 25 basis points in the first quarter of 2026, bringing the policy rate to 4.50%.
Indonesia's growth and inflation combination supports further rate easing, and fiscal measures may not address all growth issues. The Indian central bank may need to give the Indonesian rupiah more flexibility to support economic growth.