A surprise came from Bank Indonesia (BI) last week. Against market expectation, BI lowered its benchmark interest rate to 4.5 percent, down by 0.25 percent. Before, markets would not have dared to guess that the rate would decrease, considering the highly uncertain circumstances. Until this article came to print, emerging markets were still waiting anxiously for a signal from the Federal Reserve symposium in Jackson Hole, US.

Lowering the interest