- Global inflation is expected to moderate at the end of 2023, with the possible exceptions of China, India, and Brazil. However, upside risks for inflation remain due to rising oil price and weather-related distruptions that can affect food prices.
- While upside risks for inflation still persist, analysts expect the U.S. Fed to maintain its rate in 2023, with possible rate cuts in mid-year 2024 in order to boost growth and reduce unemployment. The majority of analysts view that BI will not cut its rate in 2023.
- As movements in BI rate and JIBOR are closely related, we expect that JIBOR 1-month rate will not moderate in 2023. Analysts expect that JIBOR 3-month rate to fall as early as in Q3’23, fully closing rate margin between JIBOR 1 and 3 months.
Toward Stronger Financial Industry in Indonesia