Surprise Trump Trade Deal to Weigh on Indonesia Rate Policy

The Indonesian trade deal announced by US President Donald Trump provides some clarity for the nation’s economy, although the lack of details will likely keep its central bank cautious at its monetary policy meeting Wednesday.

Before Trump unveiled the agreement on Tuesday in Washington, some 18 of 33 analysts surveyed by Bloomberg had predicted Bank Indonesia would hold rates unchanged at 5.5% to support the rupiah at its meeting in Jakarta. The rest expected a 25 basis point cut to preemptively help the slowing economy.