KONTAN.CO.ID - JAKARTA. Indonesia's central bank kept interest rates at record lows on Thursday to support the economy's recovery from the COVID-19 pandemic amid uncertainty around the new Omicron variant and the Federal Reserve's plans for a quicker bond tapering. Bank Indonesia (BI) left the 7-day reverse repurchase rate at 3.50%, where it has been since February. The decision was expected by all economists polled by Reuters. BI also kept its two other main policy rates steady. The central bank said the decision was in line with the need to support the economic recovery amid a low inflation outlook, while keeping the rupiah stable amid global market uncertainty.
Governor Perry Warjiyo reiterated BI's plan to shift its monetary stance towards "pro-stability" next year from "pro-growth" currently, under which it has cut rates by a total of 150 basis points since the pandemic started and pumped billions of dollars of liquidity into financial markets. But he also flagged global market uncertainty from the spread of the Omicron coronavirus variant and the pace of the U.S. Federal Reserve's tapering. Baca Juga: South Korea Central Bank Warns Against Inflation, Leaves Door Open for January Hike The rates decision came after the Fed announced overnight it would end its pandemic-era bond purchases in March and pave the way for three quarter-percentage point interest rates hike by end-2022. The governor has said BI will begin to reduce excess liquidity in the market next year and will consider raising rates at the end of 2022.