By Ying Xian Wong and Fabiana Negrin Ochoa
Indonesia's central bank raised interest rates in an off-schedule decision on Tuesday, pulling an emergency lever as mounting external and domestic pressures weighed on the country's currency.
Policymakers in Southeast Asia's largest economy raised the benchmark rate by 25 basis points to 5.50% and announced measures to support the rupiah, including incentives aimed at encouraging foreign investment.
They also raised the overnight deposit facility rate and lending facility rate by 25 basis points each, to 4.50% and 6.25%, respectively.
The moves are intended to stabilize the Indonesian currency amid heightened volatility stemming from the conflict in the Middle East and to ensure that inflation remains within target, Ramdan Denny Prakoso of Bank Indonesia's communication department said in a statement.