The Bank of Indonesia (BI) has cut its key interest rate by 25 basis points (bps) to 5.75%. The second time BI has cut its key rate in a bid to bring borrowing cost back down, after a period of monetary policy tightening that began in August 2022 lifted the domestic benchmark by a total of 250 bps to peak at 6.25% in April. The decision was also driven by reduced uncertainty surrounding US government policies and the Federal Reserve’s actions.