Indonesia’s central bank Governor Burhanuddin Abdullah said that the banks will continue a tight biased monetary policy in the coming months. Abdullah said this may or may not lead to increasing interest rate; which will depend on inflation data. Bank Indonesia had decided, at its Feb. 7 meeting, to leave its key policy rate unchanged for a second month. Bank Indonesia has raised its benchmark interest rate on six occasions between August and December, to a three-year high of 12.75%. While this has helped curb inflation, by strengthening the Rupiah and easing import prices; it has also severely dented domestic consumption.
