Last month has seen some new developments that may alter the policy direction of Bank Indonesia. Results of Q2 growth and dismal credit growth  pointed out sluggish growth  acceleration and weak domestic demand, which has served as growth driver in the past. This increases the risk of both  inflation and GDP growth to be below-target, particularly as the effect of major electricity price increases may have been fully reflected at current price  evel. As the result, Bank Indonesia should restart monetary policy accommodation, whether through rate cut or, if currency fluctuation is still a  major concern, by other means.

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