MACROECONOMIC ANALYSIS SERIES: BI Board of Governor Meeting, April 2022

The continuation of supply chain disruption and energy shortage as the impact of Russia and Ukraine’s conflict in various parts of the world have put pressures on the global inflation and the economic recovery process. Domestically, it has started to have impact as the inflation rate is also expected to accelerate this month like its usual seasonal trend during Ramadan and Eid al-Fitr celebrations. However, the trade balance emerged as one of the windfalls from the prolonged increasing trend of commodity prices that could maintain Rupiah stability and economic growth from export channel, also contribute to the state’s revenue.  Considering the current condition, we view BI should hold its policy rate at 3.50% this month. In addition, BI should maintain its pro-stability monetary stance and progrowth macroprudential policy during the current uncertain times.

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