The Bank of Indonesia (BI) will keep its tight monetary policy in place in 2015 and further until the current account deficit is reduced to 2.5 percent of the country’s gross domestic product (GDP), BI Governor Agus Martowardojo has said.

According to the National Statistics Office (BPS), Indonesia’s current account deficit is at 4.7 percent of GDP in the second quarter of 2014 and will only reach the 2.5 percent target after 2015.

Bank of Indonesia started a tightening cycle in June last year after the current account deficit hit a record high of 4.4 percent of GDP. In the following months, it raised the benchmark interest rate to 7.5 percent, a level that has remained unchanged since November 2013.

The policy was aimed at supporting the rupiah, easing inflation rate at 3.5-5.5 percent in 2014 and slowing growth to bring down imports.

The central bank expects the current account deficit to reach around 3.0 percent for full year 2014 against last year’s 3.3 percent.-VNA