Indonesia Lending Facility Rate
Published:
The interest rate on Bank Indonesia's conventional standing lending facility for eligible banks.
Full explanation
The Indonesia Lending Facility Rate is the interest rate charged when eligible conventional banks obtain rupiah funds from Bank Indonesia through its Lending Facility. It is part of Bank Indonesia's standing-facility framework, which helps banks manage end-of-day liquidity. The rate is typically communicated alongside the BI-Rate and the Deposit Facility Rate, helping define the upper side of the central bank's short-term interest-rate corridor.
Why traders watch it
It is one component of Bank Indonesia's monetary-policy operating framework. Changes can add context to the policy stance, banking-system liquidity conditions and short-term rupiah money-market rates.
Stronger vs weaker outcomes
A higher-than-expected Lending Facility Rate may be interpreted as a tighter upper bound for overnight bank funding and may reinforce a restrictive policy signal. A lower-than-expected rate may be interpreted as easing that funding backstop, although the wider policy package and the BI-Rate remain important context.
Typical volatility
Moderate. The Lending Facility Rate is a standing-facility rate rather than a direct measure of loan rates paid by households or businesses. Its market significance depends on whether it changes with the BI-Rate, the Deposit Facility Rate and other liquidity measures.
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