BI Rate at 5.75% Risks Gradual Rise in Bank Funding Costs
Economists see tighter liquidity competition as rupiah deposit rates rose to 2.70% in May, up from 2.65% in April.
The increase in BI-Rate to 5.75 percent is seen as starting to pressure bank funding costs and could gradually push up lending rates. BCA Chief Economist David Sumual said funding costs may rise, especially if the government withdraws SAL funds parked in Himbara, which would tighten liquidity. PermataBank Chief Economist Josua Pardede also sees the downward trend in funding costs at risk of reversing after BI raised interest rates by a total of 100 basis points in May-June 2026. The first sign was rupiah third-party deposit rates rising from 2.65 percent in April to 2.70 percent in May 2026. Even so, Josua said the pressure has not become systemic because banking liquidity remains adequate and Bank Indonesia is still maintaining sufficient liquidity through repo auctions and other instruments.