KONTAN.CO.ID - JAKARTA. Indonesia's central bank held interest rates unchanged for a second straight policy meeting on Wednesday, amid efforts to stabilise the rupiah and keep inflation within its target range.

The rate decision was the first taken by BI's board under the leadership of interim governor Destry Damayanti. Until the surprise resignation of Perry Warjiyo as BI chief last month, Destry was  the central bank's second most senior official.

She has been nominated to be the permanent governor and will take the job if she secures parliamentary approval, expected within the next few weeks.

Warjiyo's departure, just days after BI's July policy meeting, renewed investor concerns about the central bank's autonomy, after President Prabowo Subianto appointed his nephew Thomas Djiwandono as deputy governor in January and parliament passed sweeping legislation in June that doubled down on the central bank's role in supporting economic growth.

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Destry said the decision is consistent with efforts to keep the rupiah stable, manage inflation and support growth.

The rupiah and the main stock index were unchanged immediately after the decision.

The rupiah has bounced back after a dip in response to Warjiyo's exit. However, it has remained the worst performing currency among emerging Asian markets, having lost 7% so far this year against the U.S. dollar, with investors also worried about government overspending and a controversial commodity export policy, adding to a global aversion to risk due to the war in the Middle East.

BI has said its hikes were intended to attract capital inflows while also serving as a pre-emptive move to keep inflation within a target range of 1.5% to 3.5% until at least 2027. In July, inflation eased to 2.88%.

To ease pressure on economic growth, the central bank has also introduced a liquidity incentive policy designed to encourage banks to continue lending.

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BI kept its 2026 GDP growth outlook within a 4.9% to 5.7% range, after data this month showed Southeast Asia's biggest economy grew 5.3% in the second quarter.

The president, who has set a target to bring growth to 8% by 2029, said in his annual speech to parliament last week that he believed the economy  would expand by 6% this year.