IDEAS home Printed from https://ideas.repec.org/p/lpe/gomeet/202509.html

Macroeconomic Analysis Series: BI Board of Governors Meeting, September 2025

Author

Listed:
  • Jahen F. Rezki

    (Institute for Economic and Social Research, Faculty of Economics and Business, Universitas Indonesia (LPEM FEB UI))

  • Teuku Riefky

    (Institute for Economic and Social Research, Faculty of Economics and Business, Universitas Indonesia (LPEM FEB UI))

  • Faradina Alifia Maizar

    (Institute for Economic and Social Research, Faculty of Economics and Business, Universitas Indonesia (LPEM FEB UI))

  • Difa Fitriani

  • Mervin Goklas Hamonangan

  • Hardy Salim

  • Alif Ihsan A Fahta

    (Institute for Economic and Social Research, Faculty of Economics and Business, Universitas Indonesia (LPEM FEB UI))

Abstract

An increase in food prices was offset by softening personal care and transport costs, bringing Indonesia’s headline inflation down to 2.31% (y.o.y) in August 2025, well within Bank Indonesia’s 1.5-3.5% target band. Core inflation moderated to 2.17% (y.o.y), suggesting weak domestic demand. Externally, portfolio inflows lifted Rupiah earlier in September, but sentiment turned after the cabinet reshuffle and concerns over fiscal-monetary coordination, prompting outflows and renewed depreciation pressures. In this context, we view that Bank Indonesia should keep BI rate at 5.00% in September 2025 after delivering two consecutive rate cuts in July and August, to evaluate the effectiveness of recent policy transmission while closely monitoring Rupiah volatility.

Suggested Citation

  • Jahen F. Rezki & Teuku Riefky & Faradina Alifia Maizar & Difa Fitriani & Mervin Goklas Hamonangan & Hardy Salim & Alif Ihsan A Fahta, 2025. "Macroeconomic Analysis Series: BI Board of Governors Meeting, September 2025," LPEM FEBUI BI Board of Governor Meeting Brief 202509, LPEM, Faculty of Economics and Business, University of Indonesia, revised Sep 2025.
    • Handle: RePEc:lpe:gomeet:202509
    as

    Download full text from publisher

    File URL: https://lpem.org/repec/lpe/queouts/BBG202509.pdf
    File Function: First version, 2025
    Download Restriction: no
    ---><---

    More about this item

    Keywords

    ;

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:lpe:gomeet:202509. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Bintoro Seto (email available below). General contact details of provider: https://edirc.repec.org/data/feuinid.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.