AYOBANDUNG.COM - Bank Indonesia's decision to maintain the benchmark interest rate (BI Rate) at 6% is believed to be in line with its monetary and multi-financing strategy to maintain economic stability amidst global challenges.

Daily Executive (Plh) Head of Bank Indonesia (BI) West Java, Muslimin Anwar, said that the implications of the BI Rate policy are expected to have a positive influence on various sectors, including the energy sector, in a global economic condition that is increasingly full of risks.

“The risks to the global economy are getting higher, along with increasing geopolitical tensions and development fragmentation. "In the United States, more expansionary fiscal policies and domestically oriented economic strategies, including high trade tariffs, could trigger an economic slowdown and global inflation," he said at the West Java Energy Forum (WJEF) on Thursday, November 21 2024.

These global conditions, he said, affected West Java's export sector. Where West Java's export commodities face the risk of decreasing demand due to protectionist policies in America.

"Therefore, close synergy is needed between the central, regional, BI and other authorities to respond to this challenge," added Muslimin.

Bank Indonesia estimates that West Java's economic growth in 2024 will be in the range of 4.6% to 5.4%, with inflation maintained at the level of 2.5% plus or minus 1%. In 2025, the economic growth target is projected to increase to 4.7% to 5.5%.

However, Muslimin reminded that this achievement requires extra effort. "Amidst the challenges of American economic policy and potential trade barriers, West Java must focus on solid domestic development to achieve the vision of growth of up to 8% by 2028," he stressed.

He further said that the 6% BI Rate policy also had an impact on the energy sector. Credit with competitive interest rates will support investment and development of the energy sector, which is one of the backbones of the economy.

"With stable inflation and maintained growth, the energy sector can continue to contribute positively to regional development," said Muslimin. ***

(SOURCE)