Indonesian banks maintain deposit rates amid shifting investment outlooks

Indonesian state-owned banks, including Bank Mandiri, Bank Rakyat Indonesia (BRI), and Bank Negara Indonesia (BNI), have maintained their current deposit interest rates as of mid-September 2026. This stability follows a significant 100 bps aggregate interest rate hike by Bank Indonesia in June, a move driven by a weakening Rupiah and rising global oil prices following geopolitical tensions between Iran and the US.

Currently, the Indonesia Deposit Insurance Corporation (LPS) guarantee rate stands at 3.75%, up from 3.50%. Investors are monitoring upcoming FOMC decisions, as projected interest rate hikes by the US Federal Reserve may serve as a catalyst for future changes in local deposit rates.

In terms of broader investment strategy, DBS Bank Indonesia’s Chief Investment Office (CIO) has recommended asset diversification for the second half of 2026. The CIO suggests increasing allocations in Asia ex-Japan equities, developed market corporate bonds, gold, and private assets. Conversely, the report advises reducing exposure to European equities, emerging market bonds, and cash holdings to mitigate inflation and geopolitical risks.