- Bank Indonesia (BI) maintains its benchmark rate at 6.00% to uphold stability amidst a relatively stable macro environment, marked by a rebound in IDR/USD and increased capital inflows post-election.
- Concerns arise over the growing disparity between loan and deposit growth, signaling a deepening liquidity shortage that may hinder sustained economic growth.
- Government spending injections in late 2023 have aided liquidity, but recent cash-focused spending may drain liquidity from the banking system, but could boost consumption and GDP growth.
- Balancing growth objectives with maintaining financial stability poses a significant challenge for policymakers in 2024, as Indonesia aims for 5% growth amidst growing symptoms of liquidity shortage, potentially leading to short-term inflation and medium-term CA deficits.
