After cutting interest rate last month, in line with our assessment of ideal policy rate, Bank Indonesia would best achieve its overall objective by  adopting more cautious stance pending more economic data of Q3. From domestic side, slight uptick in credit growth in July and too low core inflation give conflicting signal about the pace of economic activity. From external side, there are also conflicting signals about market direction due to major  central banks’ intention to normalize monetary policy, geopolitical risk in North Korea, and combination of Hurricane Harvey, Irma, and Jose. We expect no policy rate change in the US until maybe December. This allows Bank Indonesia to swiftly respond to changes in economic data or new developments in coming months

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