BI Interest Rate Holds at Lowest Level, IHSG Claims Still Positive

Jakarta, CNBC Indonesia -

Bank Indonesia (BI) still maintains the BI 7-Day Reverse Repo Rate benchmark interest rate at 3.5%. This is in line with the expectations of market participants, where in the short term, the economy is predicted to continue to grow, credit and banking also show a fairly good performance so that it affects the market which is experiencing an increase.

“The BI rate remains at 3.5% which is the lowest level, it is indeed in accordance with the wishes of market participants. Now, but that's only in the short term," said Capital Market Observer, Teguh Hidayat when contacted by infobanknews, quoted on July 26, 2022.

Teguh is optimistic that at the end of the year, the JCI will close at 7,000-7,400 or an increase of 10% from 6,500 at the beginning of the year depending on the domestic economy and other issues. He also predicted an increase in the stock market because it has passed the recession period of 2020 and 2021 and is currently entering an era of economic recovery.

"I also believe that our stock market, our JCI, stock prices don't need to be supported in the sense that the JCI should not fall, the important thing is the economic fundamentals in the country, if our economy is really good, then stock prices will not fall. it sucks, that's all," said Teguh.

According to Teguh, Indonesia's JCI is still relatively positive, although it had slightly decreased by 3-5% and returned to its initial position of 6,500-6,600 which previously reached 7,200. When compared with the performance of the United States which has been -14% since the beginning of the year, Indonesia is still in a positive position.

"Well, why is the number still good because in fact we have a good economy for emerging market countries, inflation in our country is still relatively under control, then our economic growth has also started to be positive again, the pandemic has also been controlled, the performance of issuers has started. recovered since yesterday it fell in 2020 and 2021," he added.

If later the BI benchmark interest rate rises to 4%, Teguh estimates that this will be a negative sentiment, namely a decline in the JCI but it will not have a too significant impact, because it is supported by an already very good economy, the JCI will certainly rise again.

"So, actually the BI rate is maintained if the goal is to keep our JCI not going down. Even if the BI rate goes up, it may be short-term, it's just sentiment, the market will drop for a while but eventually it will rise again because our economic base is actually still very good," he concluded (* ) Khoirifa.