Bank Indonesia (BI), the country's central bank, lowered its overnight interest rate by one-quarter of a percent, the first cut in two months.
"The board of governors' meeting today decided to cut BI's rate by 25 basis points to 5.75 percent," a bank spokesman said in a statement.
"This decision was made as a continuous step to provide stimulus for Indonesia's economic growth in the midst of the decreasing performance of the global economy," he added.
The country's economy is still relatively strong, although slower growth is expected this year with easing inflation, the central bank spokesman said.
"The economic growth within the first quarter of this year was expected at 6.5 percent, while full-year growth could reach as low as 6.3 percent (down from 6.5 percent in 2011)," he added.
Indonesia has recently been basking in a welter of positive economic news, including a record $20 billion in foreign direct investment in 2011, a 29 percent surge in exports, and a credit rating upgrade from Moody's last month.
Indonesia's inflation was 3.79 percent in 2011, lower than the government's 5.0 percent target, while January's year-on-year rate of 3.65 percent was the lowest in nearly two years.
- AFP/ch
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