Indonesian central bank forecasts higher credit growth next year
Source: Xinhua Time:2019-12-26 08:57:56
The Indonesian central bank, Bank Indonesia, has forecast the banking credit would accelerate at a faster pace next year following its policy stimulus on the economy and banking liquidity.
The lender expected that the loan growth would nudge higher between 10 and 12 percent next year from its target of revised 8 percent this year, said the lender's Governor Perry Warjiyo.
The expected higher economic growth next year would also help spur demand for banking credits, Warjiyo said on Thursday.
The central bank had trimmed its benchmark interest rate by 100 basis points from July to October and, in November, the bank decided to trim reserve requirement ratio for banks by 50 basis points to 5.50 percent for conventional banks and 4.0 percent for Islamic banks, starting from January 2020.
Meanwhile, Deputy Minister of Finance Suahasil Nazara said on the fiscal side, the government is likely to widen development budget deficit next year from the target of 1.7 percent of the Gross Domestic Product (GDP).
The Indonesian central bank forecast that Indonesia's economy would expand between 5.1 and 5.5 percent next year compared with its growth target for this year of 5.1 percent.